coindesk.com
Robinhood’s crypto arm deepened its bet on blockchain infrastructure this past year as it expanded its products into tokenized stocks, staking products and a forthcoming layer-2 network built on Arbitrum.
The retail brokerage stunned parts of the crypto industry last year when it revealed it was building its own blockchain infrastructure atop Ethereum’s scaling ecosystem, rather than launching an independent layer-1 network. The decision, Johann Kerbrat, the firm’s crypto chief said, was ultimately about focus. Kerbrat will speak at CoinDesk's Consensus Hong Kong conference next month.
“The main discussion for us at this point was, really, should we do an L1 or should we do an L2, and the reason why we decided to do an L2 was we wanted to get the security from Ethereum, the decentralization from Ethereum, and also the liquidity that is part of the EVM [Ethereum Virtual Machine] space,” Kerbrat said. “We also wanted to be able to really focus on what we are good at, which is like building a feature that we are trying to launch, like stock tokens and other things.”
By anchoring its infrastructure to Ethereum rather than reinventing core blockchain primitives, Robinhood could offload some of the hardest technical problems. “That way we don't have to focus on decentralization and security. This is kind of for free by Ethereum,” Kerbrat added.
Robinhood’s own layer-2 chain is still under wraps. “The chain is on a private testnet right now, and we don't really have news to share on how it's going to go public,” Kerbrat said. For now, Robinhood’s tokenized stocks already live on Arbitrum One, Ethereum’s largest rollup by activity. [Rollups are a type of scaling network which batches large numbers of transactions together and processes them off Ethereum’s main network, making activity faster and cheaper while still relying on Ethereum for security.]
That choice could make the eventual transition seamless. “The beauty of the technology from Arbitrum is that the day the chain is live on Arbitrum One as well, we are going to be able to move all the assets, the liquidity, to the [new] chain,” Kerbrat said. “There isn't really any kind of migration period or anything like that for us.”
Those assets have been growing quickly. Robinhood launched its tokenized stocks program in July with a relatively small offering, but demand from customers pushed the company to scale fast. “When we launched in June, we had about 200 stock tokens. Now we have passed 2,000 [tokenized stocks],” Kerbrat said. “One of our top requests from our customers has been that 200 stocks is great, but they want to have access to the entire portfolio.”
The expansion is part of a much broader vision for tokenization. “For us, it’s really just the beginning,” Kerbrat said. “We think that it's not going to be just public stocks…We think also that we can go to private equity and real estate and art — like anything that can be tokenized.”
Robinhood has also pushed deeper into crypto-native products, including staking, an area that has been fraught with regulatory uncertainty in the U.S. “Staking was really one of our top requested features from our customers,” Kerbrat said. The company first rolled out staking in Europe, before expanding in the U.S.. “We launched it in the EU first, and we saw a lot of adoption. People really loved it. As soon as the SEC updated their guidance, we were able to start to launch it in June all over the US, except five states.”
Looking ahead, Kerbrat sees tokenized assets reshaping how yield is generated across crypto and traditional finance alike. “I think yield is going to come because of the new assets that are coming onchain,” he said. “We do expect that with more stocks, private equity, real estate, all this, you will see new lending programs.”
Even as blockchain infrastructure fragments, Kerbrat believes new layers will emerge. “This technology is already starting to replace some of the foundations of traditional finance,” he said. “The fragmentation is real, and you will see a new layer on top that harmonizes everything.”
For Robinhood, the priority remains clear. “For us, we're really focusing on the asset class — bringing new stocks and real-world assets on chain.”
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