Robinhood launches tokens allowing EU users to trade in US stocks

Robinhood said on Monday (Jun 30) it has launched tokens that will allow its customers in the European Union to trade more than 200 US stocks and exchange-traded funds, including Nvidia, Apple and Microsoft.

The commission-free tokens can be traded around the clock, five days a week. Robinhood also plans to offer tokens linked to stocks of privately held companies, starting with Sam Altman’s OpenAI and Elon Musk’s SpaceX, the trading platform’s top executives said at its keynote event in France.

Robinhood’s shares hit a record high and were last up nearly 10 per cent. The tokens will be issued through a partnership with blockchain firm Arbitrum.

With the move, the company stands to benefit from rising global interest in the US stock market, home to some of the world’s most influential tech giants and leading beneficiaries of the artificial intelligence boom.

Tokenised equities mix traditional finance with crypto-like trading, and have been gaining traction among international investors due to better access, flexible trading hours and lower costs.

Experts believe such tokens could dramatically alter the securities investing landscape, though they currently lack regulatory clarity in the United States.

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Menlo Park, California-based Robinhood plans to eventually develop its own blockchain that will expand trading hours for tokens to 24/7 from 24/5 currently.

The company will also expand the number of available stock tokens to “thousands” by the end of the year, Tenev said at the event.

“Tokenisation is going to open the door to a massive trading revolution,” he said.

Last month, crypto exchange Kraken also launched equities-linked tokens for non-US investors.

Expanding crypto tools

Robinhood also announced several new product offerings, including crypto perpetual futures for its EU customers and staking for US users.

The perpetual futures will allow users to make leveraged bets on the prices of cryptocurrencies. Unlike traditional futures, they have no expiry date.

Rival Coinbase will also begin offering similar tools to US customers from next month.

Meanwhile, staking lets customers lock up their cryptocurrency to help validate transactions on the blockchain, earning rewards in return.

The practice had been controversial in recent years, until the Securities and Exchange Commission’s staff last month said some forms of staking are not securities offerings. REUTERS