Robinhood Bets on Blockchain to Democratize US Stock Trading for Europeans

Robinhood, the platform that shook up the brokerage world with commission-free trading, is setting its sights on disrupting cross-border investing. Sources, as first reported by Bloomberg, reveal the company is actively developing a blockchain-based platform that could soon allow retail investors across Europe to trade tokenized versions of popular US stocks.

Instead of relying on legacy systems and intermediaries that often inflate costs and slow down settlement times, Robinhood is exploring the efficiency and transparency offered by blockchain. By representing ownership of US equities as digital tokens on a distributed ledger, the company aims to streamline the entire trading process for its European users.

While the specifics of the underlying blockchain technology are still under wraps, whispers point towards potential partnerships with established players in the crypto space. Both Arbitrum, a solution designed to make Ethereum transactions faster and cheaper, and Solana, a high-performance blockchain known for its speed and scalability, are reportedly in the running.

Robinhood's European expansion efforts have been underway. The company recently secured a crucial brokerage license in Lithuania, signaling its intent to offer a broader range of investment services beyond the cryptocurrencies currently available to its EU users. Furthermore, the pending acquisition of crypto exchange Bitstamp could provide Robinhood with the necessary infrastructure and regulatory framework to offer even more sophisticated digital asset products in the future.

The vision behind tokenizing securities isn't unique to Robinhood. Financial giants like BlackRock and Franklin Templeton have already dipped their toes into this space, recognizing the transformative potential of blockchain in asset management. The ability to fractionalize ownership, increase liquidity, and potentially reduce settlement times are compelling advantages that traditional finance is increasingly acknowledging.