Florida AG Investigates Robinhood Crypto Over Claims of “Lowest Cost” Trading
Robinhood Crypto Faces Scrutiny Over Allegedly Misleading Cost Claims
Robinhood Crypto, the digital asset arm of trading platform Robinhood Markets, is under investigation by Florida’s attorney general for allegedly misleading customers about the true cost of trading on its platform.
In a statement released Thursday, Attorney General James Uthmeier accused the company of promoting its services as the “least expensive way to purchase crypto” without sufficient evidence to back that claim. The investigation centers on whether Robinhood’s marketing violates Florida’s Deceptive and Unfair Trade Practices Act.
“Robinhood has long claimed to be the best bargain, but we believe those representations were deceptive,” Uthmeier said. He emphasized the importance of transparency in Florida’s growing crypto ecosystem, adding, “When consumers buy and sell crypto assets, they deserve transparency in their transactions.”
Subpoena Targets Robinhood’s Internal Cost Data
The state has issued a subpoena to Robinhood Crypto LLC requesting internal records, specifically those that might validate the company’s pricing claims. Robinhood has built its brand around offering commission-free trades for both crypto and traditional stocks. However, it earns revenue through a practice known as “payment for order flow” (PFOF), where it routes customer orders to third-party market makers who pay for that order flow.
Critics argue that while PFOF allows Robinhood to avoid direct fees, it may not always result in the best price for customers. Florida regulators say that despite Robinhood's promise of “the most crypto for your money,” users may be paying more than they would on competing platforms—once spreads and other trading factors are taken into account.
A Spotlight on Crypto Transparency in Florida
Attorney General Uthmeier also framed the investigation in the context of Florida’s broader ambition to become a leader in digital finance.
“Crypto is a vital component of Florida’s financial future,” he said, referencing support from political figures like former President Donald Trump, who has publicly backed crypto innovation.
Robinhood, headquartered in California, has not yet responded publicly to the investigation.
Despite the legal headwinds, Robinhood Markets' stock finished the day up 4.4%, closing at $98.70 on the Nasdaq, according to Yahoo Finance.
As Florida ramps up oversight of the crypto industry, the Robinhood probe underscores growing demands for pricing transparency and consumer protection in digital finance. Whether the investigation leads to penalties or policy changes remains to be seen—but for now, it places Robinhood’s crypto promises under a brighter spotlight.