Robinhood’s Tenev confirms EU probe, reaffirms stock tokens on Bloomberg TV

Investing.com -- Robinhood Markets Inc (NASDAQ:HOOD) CEO Vlad Tenev on Tuesday defended the company’s foray into tokenized equity offerings, describing it as a transformative step for capital markets and underscoring efforts to satisfy European regulators. Speaking to Bloomberg TV, Tenev outlined the mechanics of new derivative-based stock tokens that provide exposure to over 200 publicly listed companies in the EU, and pointed to broader ambitions to unlock retail access to private firms in the U.S. and UK.

The products are now live across the European Union under Lithuania’s regulatory purview, where officials have opened an inquiry into the structure and compliance footing of the offering. “I think they have some questions. You know, they want to make sure that everything is proper, because it’s a new, innovative offering, and we’re confident,” Tenev said, noting that Robinhood is committed to transparency and welcomes regulatory scrutiny.

The stock tokens are legally classified as derivatives under the EU’s MiFID and MiCA frameworks and are not direct representations of equity ownership. Instead, they are backed by traditional custody arrangements, typically a U.S. broker, that facilitate token issuance and redemption through a mint-and-burn mechanism designed to mirror price exposure to the underlying asset.

Valuation of the tokens tied to private companies remains a more complex issue, hinging on negotiated secondary market trades often limited to institutional or high net worth participants. “There is a secondary market for private assets... what this would do is it would unlock that, so it’s not just the high net worth institutional market, but it unlocks it to retail exposure as well,” Tenev explained, portraying the move as a democratization of capital access.

Robinhood debuted the effort with a promotional giveaway, $1 million worth of OpenAI token exposure and $500,000 of SpaceX, to “test the waters.” Since the pilot, the firm has received a wave of inbound interest from private companies seeking similar exposure. “I’ve had a deluge of inquiries private companies that actually want to access retail, to have their shares tokenized,” Tenev said.

Despite momentum in the EU, Robinhood’s crypto-token equity products are not yet available in the U.K. or U.S., markets with more entrenched regulatory systems and higher institutional inertia. However, talks with relevant authorities are underway, and Tenev expressed optimism about U.S. adoption in particular. “Chairman Atkins of the SEC gave an interview about tokenization. He called it a great innovation, and we agree with that.”

Tenev stopped short of providing a specific launch timeline for the U.K. or U.S., cautioning that entrenched legacy infrastructure may drag on adoption. “We haven’t even fully moved off of mainframe in the U.S., so I think it could take time,” he said, though he maintains that Robinhood’s recent product push could help accelerate regulatory openness to this model.

The crypto-powered instruments aim to address liquidity frictions and limited accessibility that have long plagued retail market participants, especially where private equity is concerned. By combining digital rails with traditional financial safeguards, Robinhood is betting that tokenized equities could become the next frontier in hybrid asset innovation.

Related articles

Robinhood’s Tenev confirms EU probe, reaffirms stock tokens on Bloomberg TV

EU nears US trade deal with Airbus exemptions, Ferrari left out - Bloomberg

Morgan Stanley cuts Ciena as profit lags AI revenue gains