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Can You Day Trade Crypto On Robinhood

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Robinhood allows users to buy and sell cryptocurrencies 24 hours a day, making it possible to day trade digital assets directly through its platform. Unlike stocks and options, cryptocurrency trades are not subject to the Pattern Day Trader (PDT) rule, meaning traders can actively trade crypto without maintaining a $25,000 account balance.This guide explains how crypto day trading works on Robinhood, whether the $25,000 PDT rule applies, the cryptocurrencies available for trading, fees, withdrawal options, and suitable alternatives for active crypto traders.

What is Robinhood Crypto?

Robinhood is a U.S.-based brokerage platform that provides commission-free access to the stock market and cryptocurrency market through its mobile app and web platform. Investors can buy and sell stocks, ETFs, options, and cryptocurrencies using an intuitive interface designed to make investing more accessible. The platform also offers portfolio tracking tools, market news, and educational resources to help users manage their investments.

In addition to stocks, ETFs, and options, Robinhood allows eligible U.S. users to buy and sell cryptocurrencies 24 hours a day, seven days a week. Cryptocurrency services are provided by Robinhood Crypto, LLC, while Robinhood's securities business is regulated separately by the SEC and FINRA. Robinhood also offers standard brokerage accounts and the Robinhood Gold subscription, which includes features that may appeal to active investors and day traders.

Can you day trade crypto on Robinhood?

Yes. Robinhood allows users to day trade cryptocurrencies 24 hours a day, seven days a week. Unlike stocks and options, cryptocurrency trading is not subject to the Pattern Day Trader (PDT) rule, so there is no limit on the number of same-day crypto trades you can make.Robinhood supports market, limit, and recurring orders for cryptocurrencies. While the platform does not charge commission on crypto trades, execution prices may include a spread. As with any cryptocurrency exchange, prices can be highly volatile, so traders should use appropriate risk management when actively trading digital assets.

Can you day trade crypto on Robinhood without $25k?

Yes. The $25,000 Pattern Day Trader (PDT) rule applies only to margin accounts used for trading stocks and options. It does not apply to cryptocurrency trading.This means you can day trade cryptocurrencies on Robinhood with less than $25,000 in your account and are not restricted by the PDT rule's limit on the number of day trades. Because the cryptocurrency market operates 24/7, traders can buy and sell digital assets at any time without being subject to stock market trading hours. However, trading with a smaller account may require more careful risk management, as cryptocurrency prices can fluctuate significantly over short periods.

Robinhood Crypto Day Trading Pros and Cons

Pros

  • Any person with access to Robinhood can freely trade cryptocurrency. Outside of verification of your identity and funding your account, there are no additional rules to start day trading on the crypto market.

  • Robinhood allows the buying and selling of whole coins as well as fractional purchases based on fiat currency.

  • Crypto markets are open 24/7 all year round, so you can choose to day trade at any time you wish.

  • Because crypto is on a decentralized blockchain, there is no intermediary there to charge fees or manage your money. 

Cons

  • Crypto is volatile and risky. With so few limits on day trading, inexperienced novice traders could incur incredible losses quite quickly.

  • The always-open crypto market might be convenient, but it can also lead to traders obsessively trading with little sleep or outside activities. It can also result in fewer patterns throughout the day that are predictable.

How to day trade crypto on Robinhood?

Day trading is not too difficult to start doing on Robinhood, especially with crypto.

Follow these steps:

  • Open your account. You will need to verify your identity and should have your ID card or passport handy. We recommend signing up via the mobile app, since you’ll need to take some photos.

  • Fund your account once you are verified. This is very easy and can be done via the Settings section under Deposits and Withdrawals.

  • Choose your asset of choice. Robinhood only has a few coins available, but they are the most popular coins on the market.

  • Research your asset and study the market constantly. This is a big part of being a day trader. You should have a strategy in place when you begin day trading, such as buying red and selling green, etc.

  • Purchase your asset of choice.

  • Monitor the market all day and execute a sell when the time is right. We recommend using signals or copy trading to make this experience easier. Do not risk a massive percentage of your capital into crypto as a beginner day trader.

Popular cryptocurrencies available on Robinhood

Robinhood supports a growing selection of cryptocurrencies, although its offering remains smaller than that of many dedicated crypto exchanges. The platform focuses primarily on well-established digital assets, making it suitable for traders who prefer high-liquidity cryptocurrencies rather than a broad range of smaller altcoins.

Among the cryptocurrencies currently available on Robinhood are Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Dogecoin (DOGE), Cardano (ADA), XRP (XRP), Chainlink (LINK), Avalanche (AVAX), Litecoin (LTC), Shiba Inu (SHIB), Stellar (XLM), and several others. Robinhood periodically expands its cryptocurrency offering, so the list of supported assets may change over time.

Robinhood crypto fees

One of the biggest reasons Robinhood is so popular as a crypto exchange is because it does not charge a lot in terms of fees. There are no commission fees required to trade cryptocurrency, and the prices for crypto are completely reliant on the ebb and flow of the market. Robinhood makes a majority of its money from market makers as well as frequency trading firms that pay for the overall order floor from retail traders. Robinhood also earns money from margin loans and securities.

Robinhood VS Webull Crypto Fees

Both Webull and Robinhood offer commission-free cryptocurrency trading. While neither platform charges direct trading commissions, execution prices may include a spread. Robinhood is known for its user-friendly interface, while Webull offers more advanced charting tools for active traders.

RobinhoodWebull

Crypto fees

$0

$0

Can I withdraw crypto from my Robinhood account?

Yes. Robinhood now allows eligible users to withdraw supported cryptocurrencies to external wallets, as well as deposit crypto from external wallets into their Robinhood Crypto accounts. This gives users greater control over their digital assets and makes it possible to transfer cryptocurrencies between Robinhood and other exchanges or self-custody wallets.Crypto transfers are available only for supported cryptocurrencies and may be subject to identity verification, network fees, transfer limits, and security reviews. Before initiating a transfer, users should confirm that the receiving wallet supports the selected cryptocurrency and verify all wallet addresses carefully, as blockchain transactions generally cannot be reversed.

Conclusion

Day trading crypto on Robinhood is accessible to all users without the $25,000 account minimum required for stocks, thanks to the lack of a Pattern Day Trader rule for cryptocurrencies. This flexibility allows traders to buy and sell digital assets like Bitcoin and Ethereum around the clock, capitalizing on market movements at any hour. However, while Robinhood charges no direct commissions, it is crucial for traders to remain mindful of the risks and the volatility inherent to crypto markets. Ultimately, the platform offers a low-barrier entry into crypto day trading, but success depends on discipline, smart strategy, and an awareness of the fast-paced environment.

FAQs

What risk management strategies should be considered when day trading crypto on Robinhood?

Because cryptocurrency prices can fluctuate rapidly, it's important for traders to use appropriate risk management strategies when day trading crypto on Robinhood. This includes only risking a small portion of your trading capital per trade, setting clear entry and exit points, possibly using stop-loss orders where available, and consistently reviewing your trading plan to avoid impulsive decisions. Beginners should be especially cautious to avoid incurring significant losses.

Are there any account or verification requirements before you can start day trading crypto on Robinhood?

Yes. Before you can start day trading crypto on Robinhood, you must create an account, verify your identity, and fund your account. Identity verification typically involves providing identification such as a government-issued ID or passport. Only once these steps are completed can you access and trade cryptocurrencies on the platform.

How does Robinhood's selection of tradable cryptocurrencies compare to dedicated crypto exchanges?

Robinhood offers a curated list of popular cryptocurrencies, focusing on major, high-liquidity digital assets. Its selection is smaller than most dedicated crypto exchanges, which typically provide access to a broader range of coins, including many lesser-known altcoins. However, Robinhood periodically expands its list of supported cryptocurrencies.

What fees, spreads, or other costs should traders be aware of when day trading crypto on Robinhood?

Robinhood does not charge commission fees for crypto trades, but execution prices may include a spread, which is the difference between the buy and sell price. This spread represents a hidden cost in each transaction. Additionally, when transferring crypto in or out of Robinhood, network fees may apply, and certain transfer limits or security checks might be in place.

Editors' Top Picks and Insights

Team that worked on the article

Ivan Andriyenko
Author at Traders Union

Ivan is a financial expert and analyst specializing in Forex, crypto, and stock trading. He prefers conservative trading strategies with low and medium risks, as well as medium-term and long-term investments.

Olga Shendetskaya
Author and editor at Traders Union

Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders.

Glossary for novice traders
Ethereum

Ethereum is a decentralized blockchain platform and cryptocurrency that was proposed by Vitalik Buterin in late 2013 and development began in early 2014. It was designed as a versatile platform for creating decentralized applications (DApps) and smart contracts.

Index

Index in trading is the measure of the performance of a group of stocks, which can include the assets and securities in it.

Brokerage fee

A brokerage fee, also known as a commission, is a fee charged by a brokerage or financial institution for facilitating and executing financial transactions on behalf of clients. Brokerage fees are typically associated with services related to buying or selling assets such as stocks, bonds, commodities, or mutual funds.

Volatility

Volatility refers to the degree of variation or fluctuation in the price or value of a financial asset, such as stocks, bonds, or cryptocurrencies, over a period of time. Higher volatility indicates that an asset's price is experiencing more significant and rapid price swings, while lower volatility suggests relatively stable and gradual price movements.

Risk Management

Risk management is a risk management model that involves controlling potential losses while maximizing profits. The main risk management tools are stop loss, take profit, calculation of position volume taking into account leverage and pip value.