Fintech firm Robinhood has hired a new chief compliance officer at its cryptocurrency arm ahead of the first round of testing for its cryptocurrency wallet offering.
Benjamin Melnicki joins Robinhood Crypto (RHC) from digital currency investing services company Grayscale Investments, where he had served as chief compliance officer since January, according to his LinkedIn profile. Melnicki has previously worked in regulatory counsel roles at cryptocurrency firms Ripple and Blockchain.com.
The timing of his appointment aligns with Robinhood’s announcement Sept. 22 that customers will begin testing cryptocurrency wallets starting in October. The offering is designed to allow users to send cryptocurrency to other wallets and receive supported cryptocurrencies through the Robinhood app.
“We’re excited to make crypto more accessible by making investing simpler, more straightforward, and low cost –– just as we’ve done for equities,” Robinhood stated in a blog post.
Already facing regulatory pressure as part of a wider Securities and Exchange Commission (SEC) probe into how digital engagement practices affect the investment strategies of retail investors, Robinhood’s expanding foray into cryptocurrency is likely to put a larger target on the company’s back. New SEC Chair Gary Gensler has pledged to increase scrutiny of the cryptocurrency market through regulation.
RHC has also run into trouble with regulators, with Robinhood disclosing in July it expects to pay a fine of $30 million in a settlement with the New York State Department of Financial Services (NYDFS) regarding anti-money laundering and cyber-security failures. The NYDFS is expected to appoint an independent monitor in the case.