<p>By Sruthi Shankar and Medha Singh</p> <p>Aug 19 (Reuters) – Shares of Robinhood Markets Inc fell 9% on Thursday as the fee-free broker’s warning about a slowdown in trading raised concerns about its reliance on a pack of small-time investors to sustain a frenzy in stocks, options and cryptocurrencies.</p> <p>In its first results as a public company on Wednesday, Robinhood said the crypto trading mania this year helped double its second-quarter revenue, but also warned it expected retail investors who trade on its popular app to take a breather in the third quarter.</p> <p>”Robinhood is dependent on high volatility and you don’t get high levels of volatility all the time,” said David Madden, market analyst at Equiti Capital.</p> <p>”It comes in spurts and it can just be a ghost town for months and months.”</p> <p>Dogecoin, a meme-inspired cryptocurrency that made up 62% of Robinhood’s total crypto volumes in the second quarter, has catapulted around 9,000% in value in the past year.</p> <p>Bitcoin, the world’s biggest cryptocurrency, is up 52% this year, but Refinitiv data shows trading volumes have declined in every month since May.</p> <p>Robinhood’s own stock has been dubbed the “meme of memes” after it rallied like meme stocks GameStop Corp and AMC Entertainment, and 비트코인 거래소 is up about 30% since its market debut on July 29.</p> <p>Still, Chief Financial Officer Jason Warnick said on CNBC Robinhood was not looking to capitalize on the rally by selling new shares.</p> <p>GameStop and 비트코인 거래소 AMC have both raised billions of dollars in new capital amid the frenzy in their shares.</p> <p>Robinhood’s stock was down 9% at $45.23 by 9:35 a.m.

ET on Thursday and was among the top 20 most-traded stocks on the Nasdaq.</p> <p>Social media chatrooms were abuzz with activity as users reacted to the company’s warning.</p> <p>”I wouldn’t buy this. (Too) many red flags. If you made money, good, but this will never go to $80 again,” a Stocktwits user wrote on the trading-focused social media site, tagging Robinhood’s ticker $HOOD.</p> <p>Robinhood also said it was considering selling branded merchandise, 비트코인 거래소 in a move similar to AMC, which has floated the possibility of selling products from theaters.</p> <p>(Reporting by Sruthi Shankar and 비트코인 거래소 Medha Singh in Bengaluru; Editing by Sagarika Jaisinghani and Saumyadeb Chakrabarty)</p></div>

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