Robinhood is making strides towards developing a blockchain-based platform that will allow retail investors in Europe to trade US securities, including stocks. According to a report by Bloomberg, the initiative is expected to be launched in collaboration with a digital-asset firm, with discussions currently underway to finalize the partnership. Two blockchain platforms, Arbitrum and Solana, are being considered for the project.
This move by Robinhood to offer tokenized US securities reflects a broader trend in the financial industry. As institutions worldwide explore the potential of blockchain technology, there is a growing interest in leveraging it to streamline trading processes, reduce costs associated with traditional infrastructure, and enhance transparency and standardization.
In a recent development, Robinhood has obtained a brokerage license in Lithuania, enabling the company to expand its services within the European Union to include stock trading. Additionally, the platform is in the process of acquiring crypto exchange Bitstamp, which would allow Robinhood to offer crypto-linked derivatives under Bitstamp’s MiFID multilateral trading facility license.
Despite experiencing significant growth in its cryptocurrency business, with a 50% revenue increase in the first quarter of the year, Robinhood aims to diversify its revenue sources. CEO Vlad Tenev emphasized the company’s focus on reducing its reliance on crypto transaction volumes over time to ensure a more balanced business model.
By tapping into the rising demand for blockchain-based financial products, Robinhood’s expansion in Europe, supported by Lithuania’s regulatory framework, marks a strategic move in its international growth strategy. However, the platform’s success will depend on its ability to attract a substantial user base and adapt to the evolving market dynamics in the EU.
Overall, Robinhood’s plans for blockchain-based trading of US securities in Europe signify a significant step towards providing innovative investment opportunities for retail investors while staying ahead of industry trends.