Robinhood stock surges on tokenization push, but regulators have questions

Shares of Robinhood have rallied sharply since the company unveiled its tokenization-focused blockchain, which aims to offer more than 200 US stock and ETF assets to European investors.

However, European regulators are scrutinizing the company’s “private equity tokens,” particularly those linked to OpenAI and SpaceX. The Bank of Lithuania said it is “awaiting clarifications” regarding these offerings after OpenAI said that the product does not actually provide private equity in the company.

Robinhood CEO Vlad Tenev explained that these tokens do not technically represent equity in the underlying companies but give investors indirect exposure. Despite the regulatory questions, Tenev said several private companies have already approached Robinhood about launching similar products.