Florida’s Attorney General has launched an investigation into Robinhood, alleging the trading platform has misrepresented its crypto services as the lowest-cost option available. The probe accuses Robinhood of violating the state’s Deceptive and Unfair Practices Act, and a subpoena has been issued demanding documents from the company.
Dispute Over Payment for Order Flow
The investigation centers on Robinhood’s use of payment for order flow (PFOF), a revenue model where third parties pay the platform to route customer trades. Florida’s top prosecutor, James Uthmeier, claims this could lead to worse prices for users, contradicting Robinhood’s low-cost claims. Critics argue that this model may prioritize profit over customer value.
Robinhood CEO Vlad Tenev previously defended PFOF in a December 2023 CNBC interview, amid growing concerns that it could create conflicts of interest. In 2020, the company paid a $65 million SEC fine—without admitting wrongdoing—for misleading customers about trade execution quality.
Robinhood Maintains Transparency
Robinhood’s General Counsel, Lucas Moskowitz, responded by affirming that the platform clearly discloses all relevant trade costs. He stated that Robinhood provides detailed pricing data throughout the trading process and maintains its commitment to offering crypto trades at industry-low costs.
Investors Largely Unfazed
Despite the legal action, Robinhood’s stock gained 4.4% to close at $98.70 on Thursday, nearing its record high of $100.88, buoyed by a broader crypto market rally. After hours, shares dipped slightly by 1.49% to $97.23.
Over the past month, Robinhood’s stock has surged 30%, driven by its increasing involvement in blockchain innovation and asset tokenization. The company has until the end of July to respond to the state’s subpoena.
July 2025, Cryptoniteuae
