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Robinhood launches beta no-fee crypto wallet

Yahoo Finance's David Hollerith joins the Live show to discuss the launch of Robinhood's beta no-fee crypto wallet.

Video transcript

BRIAN SOZZI: Some crypto traders on Robinhood will get to take a crack at the platform's new no-fee crypto wallet. Joining us to explain what this means for crypto traders is Yahoo Finance's crypto reporter David Hollerith. David.

DAVID HOLLERITH: Brian, this is a beta test for the new crypto wallet. And the difference between this wallet and past wallets is that it's a non-custodial wallet, which means customers control their private keys. Essentially, the funds aren't held on the Robinhood platform. Now, this is, obviously, interesting, given that there have been recent bankruptcies, in which case, customers have sort of lost their funds to a bankruptcy estate. So this is, obviously, something that's sort of considered an important feature for the security minded in the crypto sector.

Second to that point, this wallet will actually cover blockchain network transaction fees for users, which is interesting. It is something that looks sort of like a crypto specific version of Robinhood's payment for order flow model, the key exception being that Robinhood will not receive rebates from market makers who will fill the orders for customers using the wallet by paying their transaction fees.