Summary
- Robinhood has declined AMC’s request to stop trading tokens linked to its shares.
- Legal experts suggest that AMC's claims may hinge on trademark usage and potential buyer confusion.
- Some attorneys believe that stock tokens can enhance access to U.S. markets.
In a bold response to AMC Entertainment’s request to cease trading tokens associated with its stock, Robinhood has made it clear that it will not comply. The brokerage's chief legal officer has openly challenged AMC to follow through with its legal threats.
“Send your lawyers and we’ll educate them,” stated Dan Gallagher, Robinhood’s chief legal, compliance and corporate affairs officer, in a post on X, responding to AMC CEO Adam Aron.
Myriad: How high will Nvidia stock go? Click to make your prediction. former commissioner of the Securities and Exchange Commission, asserted that Robinhood is well-versed in U.S. securities laws and would not “DECIST,” humorously echoing a misspelling from Aron’s demand.In support of Gallagher's stance, Robinhood CEO Vlad Tenev shared the post, emphasizing, “We stand behind Stock Tokens.”
Aron has accused Robinhood of promoting a security that mimics AMC stock without adhering to U.S. securities regulations. He raised concerns about the use of an issuer in Jersey and claimed that these tokens compromise shareholder rights and companies' authority over capital raising.
“I hereby call on you and Robinhood to voluntarily CEASE AND DECIST the trading of AMC stock tokens,” Aron stated. “If you don’t, our high-priced securities counsel has been asked to see whether we can force you to stop.”
A cease-and-desist letter compels an entity to halt purportedly illegal activities, such as copyright infringement, and warns of legal repercussions if they continue.
Aron also mentioned that AMC would present its issues to the SEC but did not indicate that a lawsuit or SEC investigation had been initiated.
Tokenized stocks are blockchain-based representations of shares in publicly traded companies and have surged in popularity, with a reported $15.1 billion in trading volume during the first quarter of 2026, according to CoinGecko.
According to Robinhood’s disclosures, these tokens are classified as debt securities issued by Robinhood Assets (Jersey) Limited. They allow exposure to stock prices without granting ownership of the underlying shares or rights against companies like AMC. The disclosures specify that these tokens are not registered under U.S. securities laws and cannot be sold or delivered within the United States or to U.S. citizens.
Ashley Ebersole, legal counsel for tx, a platform for tokenizing real-world assets, remarked to Decrypt that there doesn’t appear to be a clear U.S. securities law issue to pursue. He highlighted the offshore nature of the products and their absence from Robinhood’s U.S. app.
“The two strongest potential angles would be if AMC alleged misuse of their trademark that goes beyond the ‘fair use’ usually afforded to the marks of public companies,” he noted. “Or they could claim the tracking token creates a false association with AMC that does not actually exist.”
Ebersole suggested that Robinhood could counter these allegations by clearly labeling the products as tracking tokens that are not endorsed by AMC, minimizing the use of AMC’s branding, or asserting that its use of the company's name constitutes fair use.
Miami-based crypto attorney Russell Klein, known as @CryptoEsq on X, expressed that clear disclosures differentiating the tokens from shares could limit AMC’s options.
“If they clarify with disclaimers and terms that it’s not claiming to be the company’s shares but is a derivative, then they don’t have any recourse other than legal threats and lobbying regulators,” Klein explained to Decrypt.
He contended that AMC lacks property rights to prevent third parties from creating financial instruments linked to its stock, arguing that trademark law can allow for the use of a company's logo for identification purposes.
“For me, overall, it’s just: Are they being misleading about the tokens being the stock or having those rights? And I doubt traders think they’ll be able to vote at meetings or whatever,” he stated. “But even then, if you’re in the right jurisdiction, you can probably even enter into a program agreement with the stock tokenization company and redeem those tokens for real shares if it doesn’t violate transfer rules, and they would actually get the real stock.”
Daniel Lasko, general counsel at Arcus, a decentralized exchange in collaboration with Robinhood on its Ethereum layer-2 Robinhood Chain, also questioned AMC’s ability to prevent such products from existing.
“If you’re a publicly traded company, I think from a securities law standpoint, you don’t have a lot of control over how people might package your publicly traded stocks into financial products,” Lasko told Decrypt.
He compared the situation to an investment manager including a company’s shares in an ETF, suggesting that much of the concern arises from a lack of understanding regarding tokenized stocks.
Lasko further disputed Aron’s claim that these products undermine U.S. capital markets, asserting that they could draw international investors who previously did not have access.
“I think that’s a little bit backwards,” he stated. “It’s promoting more investment into U.S. capital markets.”
Last summer, Robinhood launched tokenized stock trading for European customers. In July, OpenAI raised objections to tokens using its name, claiming no partnership with Robinhood or approval for an equity transfer. Later that month, Tenev defended the company's expansion despite the backlash.
AMC's objections now bring the growing sector of tokenized stock trading into focus once again, highlighting the tensions between traditional companies and innovative financial products.