Falling Cryptocurrency Prices and Concerns Surrounding Lower Prediction Market Activity Weighs on Robinhood Markets (HOOD)

Robinhood Markets, Inc. (NASDAQ:HOOD) stands out as one of Cathie Wood’s 10 stock picks with huge upside potential.

On February 2, 2026, falling cryptocurrency prices and concerns surrounding lower prediction market activity weighed on the stock, driving Robinhood Markets, Inc. (NASDAQ:HOOD) shares downward. The stock declined by more than 10% during the day, bringing the year-to-date decline to 20%. The stock closed at $89.91, down from $99.48 in the previous session.

On the same day, Bitcoin fell to a 10-month low near $74,500, rattling digital-asset traders. However, Bitcoin recovered later in the day. This is highly relevant for Robinhood Markets, Inc. (NASDAQ:HOOD), whose platform supports trading in over 50 crypto tokens and whose revenue is closely tied to crypto prices and trading volume.

In addition to crypto volatility, a seasonal headwind associated with the end of the football season was highlighted by Piper Sandler on the same day. The firm cited prediction markets as Robinhood Markets, Inc. (NASDAQ:HOOD)’s fastest-growing revenue stream, with football driving nearly half of Kalshi’s volume since August 2025. Despite this, the investment firm reiterated its ‘Buy’ rating on the stock with a $155 price target, attributing its stance to a pipeline of global sporting events and elections later in the year.

On the same day, Mizuho revisited Robinhood Markets, Inc. (NASDAQ:HOOD), reiterating an ‘Outperform’ rating with a $172 price target. The investment firm believes the company’s UK launch of a zero-fee stocks and shares ISA with a 2% cash bonus before April 5, 2026, could prove to be a key catalyst for international expansion.

Robinhood Markets, Inc. (NASDAQ:HOOD) is known for operating a digital financial platform that offers commission-free trading in stocks, ETFs, options, and cryptocurrencies. The company also offers cash management services, targeting retail investors through a mobile-first, simplified investing experience.

While we acknowledge the potential of HOOD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.