Robinhood warns that a Dogecoin crash, ‘limited operating experience,’ and any new regulations could hurt its stock price

• Online trading company Robinhood filed for its initial public offering on Thursday.
• Its "risk factors" detail what could harm its business, and its investors, moving forward.
• The list includes regulation, hacks, the volatile crypto market, and its limited experience.
• See more stories on Insider's business page.

Robinhood, the free stock trading website, is officially going public.

The company filed documents for an IPO with the Securities and Exchange Commission on Thursday, revealing staggering growth amid a boom in retail trading. That document also listed risk factors that could harm the company and its stock price.

While many of the risk factors are commonplace for all companies and routine in regulatory filings, Robinhood's pioneering of free stock trading and recent dive into cryptocurrencies could pose unique hazards for investors.

Pandemic growth may not last as things reopen

Robinhood said the company saw "substantial growth in our customer base" since March 2020, when stay-at-home orders and an uptick in personal finance interest drove people onto the trading platform. As of the end of March 2021, the company said there were 18 million funded accounts.

But Robinhood said it's not sure if those trends and behavioral shifts will remain as the world reopens and "we may not be able to maintain the customer base we gained."

Robinhood has 'limited operating experience'

Robinhood said it has grown so rapidly in such a short amount of time that its financial performance could suffer if it can't manage its growth effectively.

The online trading platform launched in 2013 and started letting people buy and sell some cryptocurrencies in 2018. In the meantime, it's hit several speed bumps with new product offerings in the past.

Dogecoin accounts for 34% of its crypto-trading revenue

The joke altcoin brought in a good chunk of revenue for Robinhood in the first quarter. It said if interest declines in the digital asset, the company could be affected.

Robinhood will be more regulated and could face litigation

Robinhood said that changes in the "extensive, complex, and changing laws and relations" and regulatory proceedings and investigations could harm its business. The company noted that it had already been investigated over regulatory matters and expects that it will be in the future "given the highly regulated nature of the industries in which we operate."

Robinhood also said changes in US tax laws, such as increases proposed by the Biden administration, and policies could impact its "financial condition."

'Harm to our brand and reputation'

Robinhood said its brand and reputation are "two of our most important assets."

Any negative publicity could have an effect on the company's platform, even if it's "factually incorrect or based on isolated incidents." That could mean cybersecurity attacks, security breaches, allegations of fraud, proposed regulatory action or litigation, and failing to comply with legal and tax requirements.

If Robinhood is hacked, users could lose cryptocurrencies

"If we are unable to access our private keys or if we experience a hack or other data loss relating to the cryptocurrencies we hold on behalf of customers, our customers may be unable to trade their cryptocurrency and our reputation and business could be harmed," Robinhood said.

The company also pointed to the volatility of the crypto market, whose uncertainty could adversely affect the platform's success.