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Robinhood Markets Inc is aiming for a blockbuster IPO

The stock trading platform is expected to debut on the Nasdaq this week and could reach a market cap of $ 35 billion

will debut on the Nasdaq later this week in one of the hottest-anticipated initial public offerings (IPOs) in 2021.

The stock trading platform is expected to cost its IPO shares between $ 38 and $ 42, the company said in its filing document, with a valuation of $ 35 billion in the upper range.

READ: Robinhood’s crypto division is facing a $ 30 million fine from New York regulators

Around 55 million shares are to be offered at the IPO, of which the founders Vlad Tenev and Baiju Bhatt and their CFO will sell 2.63 million. After the IPO, Tenev will hold around 26% of the voting shares and Bhatt will hold 39%.

The platform, which enables retail investors to trade stocks, cryptocurrencies and options commission-free through its website and app, enjoyed huge popularity earlier this year as the explosion in crypto markets and the buying frenzy for stocks like () and () Inc users poured in onto the platform, with the user base adding 6 million accounts in the first two months of 2021 alone.

Although Robinhood’s business has grown rapidly and has garnered the support of several institutional investors, some analysts warn that the group still faces challenges that could deter some investors from helping the group make its debut in the public markets.

“While Robinhood has expanded rapidly over the past year, it has not come without public backlash and regulatory scrutiny. Massachusetts regulators are trying to ban their citizens from trading the app, claiming that Robinhood’s gamified investment platform has misled its clients to take too high a risk in violation of the state’s fiduciary rules, ”said Maxim Manturov, Head of Investment Research at Freedom Finance Europe.

The company is also facing a regulatory setback from its crypto operations, saying in an SEC filing last week that it was fined the New York State Department of Financial $ 30 million for alleged violations as part of a settlement Paying Services (NYDFS) will comply with the anti-money laundering rules of the US state.

Manturov also noted that the company operates in an “extremely competitive market” in which many deep pocket competitors are searching for their best strength.

“Charles Schwab recently completed an acquisition of () $ 26 billion. () bought E-Trade. And the Chinese investment app WeBull aims to copy Robinhood’s approach to gamified app investing. In addition, its most direct competitor, eToro is aiming for an IPO in 2021, ”said Manturov.

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