Robinhood Ceo Vlad Tenev Says Tokenization Is Coming For All Financial Markets

Robinhood CEO Vlad Tenev said said banking incumbents have "certain benefits," but can't move as fast.

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• Vlad Tenev thinks that tokenization is going to inevitably overtake financial markets.
• The Robinhood CEO recently stated that he expects it to continue shaping the investing landscape.
• He claimed that while the company is still figuring some things out, tokenization can't be stopped.

Robinhood stock's year-to-date gain is inching toward 300%, with at least some of that attributable to the retail-trading platform's position at the edge of a growing trend in financial markets.

"Tokenization"—the act of taking an asset like a stock, bond, or even deed to a piece of property, and creating a digitized version secured to the blockchain—was in the spotlight earlier this year when Robinhood Markets announced it would offer investors in Europe a chance to purchase tokenized equity in some of the hottest private firms like SpaceX and OpenAI.

The excitement helped propel a big jump in Robinhood's stock, even as OpenAI publicly distanced itself from the plan and warned the tokens aren't real equity.

Months later, Tenev has doubled down on his view of tokenization, saying that he believes the trend is coming for the whole financial system.

"Tokenization is like a freight train," he said at the TokenWorld 2049 crypto conference in Singapore on Wednesday. "It can't be stopped, and eventually it's going to eat the entire financial system."

The process of tokenizing an asset refers to creating a digital token and securely storing it on a digital ledger. It allows assets to be traded outside of normal market hours and is intended to increase transaction speed.

For Robinhood, it represents an opportunity to offer retail investors exposure to non-public companies and easier access to US-listed stocks to overseas investors.

But Tenev sees a future in which tokenization will bridge the gap between crypto and traditional finance, merging the two worlds.

"In the future, everything will be on-chain in some form and the distinction will disappear," he predicted.

Tenev acknowledged that it will likely take time for everyone to become comfortable with the tokenization process, noting that some companies have raised concerns. Critics have also warned that such tokens aren't actually equity, and their prices are merely a reflection of the actual stock and could fluctuate more.

Still, Tenev said that he thinks the technology will be commonplace within the next five to 10 years.

"What's clear is that customers want it," he said. "It's going to be a big market."