As stock tokenization turns into a brand new battlefield in the crypto market, following Coinbase and Kraken, Robinhood formally introduced the launch of tokenized stock buying and selling, masking greater than 200 US stocks and ETFs, and launched a Layer2 blockchain devoted to RWA based mostly on Arbitrum.
Writer: Nancy, PANews
Robinhood, which as soon as attracted a brand new technology of stockholders to commerce MEME stocks due to the “retail buyers vs. Wall Road” marketing campaign, formally unveiled its crypto ambitions. As stock tokenization turns into a brand new battlefield in the crypto market, following Coinbase and Kraken, Robinhood formally introduced the launch of tokenized stock buying and selling, masking greater than 200 US stocks and ETFs, and launched a Layer2 blockchain devoted to RWA based mostly on Arbitrum.
Influenced by this information, as of the shut of June 30, Robinhood’s stock value rose by greater than 12.7% to $93.6, setting a report excessive. At the similar time, Arbitrum token ARB fell barely throughout the day, primarily as a result of the earlier constructive information had been digested by the market upfront.
Formally launched the tokenization of US stocks in the EU, and collectively developed the official L2 with Arbitrum
On the night of June 30, at a press convention in Cannes, France, Robinhood introduced that it could present stock tokenization buying and selling providers to EU customers. It now helps greater than 200 US stock belongings for 24-hour on-chain, 5 days per week circulation and buying and selling, together with OpenAI and SpaceX tokens, and plans to develop to 1000’s by the finish of this yr.
At present, Robinhood EU is gifting away the first batch of personal firm stock tokens without cost. In case you are a Robinhood EU person and meet the {qualifications}, you may declare the tokens in the app till July 7.
It’s reported that the product solely expenses a 0.1% overseas trade conversion price to cut back the excessive middleman prices for European buyers to entry the U.S. market. In the future, customers might be ready to self-custody tokenized stocks and ETFs by means of Robinhood’s crypto pockets, or select a simplified operation expertise with out managing non-public keys.
Furthermore, Robinhood mentioned it’s growing its own Layer2 blockchain designed for RWA based mostly on Arbitrum, tentatively named Robinhood Chain, and its availability relies upon on relevant rules and future launch time. Johann Kerbrat, basic supervisor of Robinhood Crypto, mentioned that the design of this new chain started a number of years in the past and was structured round RWA, aiming to break the “walled backyard” of conventional finance and obtain a extra open and clear asset buying and selling expertise.
In reality, Robinhood has lengthy introduced the launch of its stock token product. In Could this yr, Bloomberg quoted folks acquainted with the matter as saying that Robinhood is actively growing a blockchain-based platform that enables European retail buyers to commerce U.S. tokenized stocks, thereby increasing its enterprise structure in the European market.
In accordance to folks acquainted with the matter, the three way partnership could also be launched by partnering with a digital asset firm, and Arbitrum and Solana are looking for to turn out to be companions in the challenge. The negotiations between the two events are nonetheless in progress and no ultimate conclusion has been made.
In the similar month, a job posting by Robinhood additionally confirmed this enterprise structure. The corporate is on the lookout for a product supervisor to construct a brand new encryption product structure from scratch that helps cross-chain growth. At present, the place is closed for utility.
So as to advance this enterprise structure, Robinhood obtained a Lithuanian brokerage license in April this yr, qualifying it to present funding providers inside the European Union. At the similar time, Robinhood acquired the established cryptocurrency trade Bitstamp for $200 million to additional consolidate its expertise and compliance basis in the European market.
As for technical cooperation, a number of indicators have proven that Arbitrum has turn out to be a core companion of Robinhood’s tokenized stock challenge. For instance, the entrance to Robinhood’s official web site seems on the homepage of the Arbitrum Portal official web site collectively with the Stylus expertise promoted by Arbitrum; Robinhood introduced that it’s going to launch essential crypto enterprise at the Cannes EthCC convention, and will take part in fireplace chats with senior executives of the Arbitrum growth staff. The market has responded to this excellent news first. Arbitrum’s token ARB has achieved double-digit progress in latest days, with the highest enhance of greater than 25% in the previous 7 days. This isn’t the first cooperation between Robinhood and Arbitrum. As early as March final yr, the Robinhood pockets introduced the integration of Arbitrum to present its customers with improved token trade providers.
It’s value mentioning that as well as to launching US stock tokenization merchandise, Robinhood additionally introduced a collection of crypto asset features, together with that European customers might be ready to commerce crypto perpetual contracts (with no expiration date) with up to 3x leverage, and US customers might be ready to pledge ETH and SOL in compliant areas. As well as, Robinhood can even launch a bank card that helps crypto cashback, a customized AI assistant Robinhood Cortex, a brief 1% reward for crypto deposits, and the introduction of a “tax batch” operate to assist customers obtain higher tax methods when promoting crypto belongings.
Tokenized stocks welcome extra gamers, Robinhood submits coverage proposal calling for regulatory reform
In the previous few months, many crypto establishments have regarded the tokenization of securities as an essential a part of their strategic growth. For instance, Kraken has allowed non-US prospects to commerce stocks in the type of tokens, and has launched 60 tokenized US stocks in Europe, Latin America, Africa and different locations; Coinbase is looking for SEC approval to launch tokenized stock providers, and if authorised, it could actually conduct stock buying and selling enterprise to compete with different brokers; Gemini additionally introduced that it’s going to cooperate with Dinari to launch tokenized stock buying and selling providers for EU customers, and the first supported asset is Technique (MSTR), and extra tokenized stocks and ETFs will proceed to be launched in the future; Dinari, a US stock buying and selling service startup, has obtained broker-dealer registration {qualifications} for its subsidiaries, making it the first tokenized stock platform in the United States to get hold of such approval.
For conventional brokerages which can be deeply restricted by compliance and clearing techniques, the tokenization of securities is regularly altering the conventional construction with its low threshold, flexibility and composability. Robinhood, which began as a retail securities buying and selling platform, has confronted progress stress from conventional companies lately. Its zero-commission mannequin for stock buying and selling has been tough to keep its aggressive benefit. For that reason, it has additionally began a diversified structure of encryption enterprise and achieved good outcomes. In the first quarter of this yr, Robinhood’s complete income elevated by 50% year-on-year, of which the encryption enterprise income doubled year-on-year to US$252 million.
The disruptive potential of tokenization is one other crypto monitor that Robinhood is speeding to seize. In reality, Robinhood CEO Vlad Tenev has publicly and clearly expressed his assist for the tokenization of securities, saying that increasing retail buyers’ funding channels in the non-public fairness market is “one among the most essential coverage priorities” of the firm.
In January this yr, Tenev wrote an article in The Washington Publish stating that corporations equivalent to OpenAI and SpaceX are nonetheless non-public corporations. Solely a small group of rich insiders with entry and capital can enter the firm in the early phases. These folks at the moment are usually getting 1,000 occasions or extra of their preliminary funding, whereas abnormal buyers haven’t any likelihood to take part in any respect. This funding hole is changing into extra and extra serious-the variety of listed corporations in the United States as we speak is simply half of that in 1996. At the similar time, the so-called “certified investor rule” limits most non-public funding alternatives to teams with a web value of greater than $1 million and an annual revenue of greater than $200,000, leading to about 80% of American households being excluded.
Tenev believes that what crypto expertise actually supplies is a monetary system that’s fairer, extra versatile, and extra in line with the wants of the twenty first century, and will usher in the most inclusive funding revolution since stock buying and selling went from buying and selling flooring to electronicization. This expertise can flexibly break up and distribute possession, making it freely tradable like stocks, with just a few adjustments to current company fairness authorized paperwork. As soon as non-public corporations are tokenized, abnormal buyers can take part of their early phases of growth, relatively than ready for them to go public at a valuation of tens of billions of {dollars} earlier than being allowed to enter. Firms can use this to get hold of crypto retail funds from round the world with out sacrificing the regular governance mechanisms of personal corporations, equivalent to worker choices and share lock-ups.
Nonetheless, Tenev additionally admitted that the fairness of personal corporations in the United States is presently regulated by the U.S. SEC, however no clear steering has been given on how to legally concern and commerce tokenized securities on crypto platforms. In distinction, the European Union, Hong Kong, Singapore, Abu Dhabi and different locations have successively established a whole regulatory framework to assist safety token issuance (STO) and digital exchanges.
He proposed that the United States ought to promote three key reforms to launch the dividends of securities tokenization: First, abolish the certified investor system based mostly on wealth thresholds. In an period the place everybody can freely purchase and promote MEME cash, it’s outdated and absurd to measure funding {qualifications} by web belongings. If a threshold should be set, it must be based mostly on funding data and danger self-assessment, relatively than account balances; second, set up a “Securities Token Registration System” to present small and medium-sized corporations with a brand new financing path as well as to conventional IPOs, decreasing prices and thresholds; third, present a transparent compliance path for crypto buying and selling platforms in and exterior the United States, together with centralized and decentralized exchanges, to be sure that securities token transactions might be legally and safely opened to the public.
It’s value mentioning that Robinhood submitted a 42-page coverage proposal to the US SEC in Could this yr, together with a nine-page remark letter on asset tokenization, calling for the institution of the world’s first federal regulatory framework for RWA tokenization, and revealed that it’s going to construct an RWA buying and selling platform Robinhood RWA Alternate based mostly on Solana and Base.
