Robinhood faces EU scrutiny after launching tokenized stocks
Robinhood in EU talks on tokenized equity launch
Robinhood Markets has entered discussions with European Union regulators, including the Bank of Lithuania, following the launch of its tokenized stock offering across the EU.
The new product allows investors to trade blockchain-based tokens representing shares of U.S. companies, marking a bold step in bridging traditional equity markets with crypto infrastructure, Cryptopolitan reported.
CEO Vlad Tenev confirmed that regulators have requested additional information regarding the structure and nature of the tokens, particularly in relation to their legal standing.
“They have some questions,” Tenev stated. “We’re confident. We think these are not only important, but they’ll withstand the highest form of scrutiny.”
The Bank of Lithuania, which oversees Robinhood’s European division, acknowledged it had asked for further clarification but declined to offer additional comment.
Ownership concerns and non-tradable private company tokens
As part of the rollout, Robinhood distributed free token samples to European users, including representations of privately held firms like OpenAI and SpaceX. However, OpenAI swiftly cautioned that these tokens do not represent real ownership stakes, raising questions about the clarity and legality of such instruments.
Tenev clarified that tokens tied to private companies are not yet tradable, and their valuation is derived using Robinhood’s internal proprietary model. The firm emphasized that only tokens representing publicly traded equities would initially be active in the market.
Robinhood’s move comes at a time when global financial authorities are increasingly scrutinizing digital asset products. The company, known for its retail investor-friendly platform and commission-free trading, sees tokenized equities as a step toward expanding investor access and market efficiency.
Outlook and market implications
Robinhood’s foray into tokenized stocks signals an ambitious push to reshape how retail investors interact with global equity markets. However, its success may hinge on how regulators across jurisdictions assess the legal and financial frameworks underpinning token-based equity.
The EU review process could serve as a bellwether for other markets evaluating the fusion of blockchain and traditional finance.
We informed you earlier that Robinhood launches tokenized stocks and perpetuals in EU.
