Summary
- Robinhood has introduced the public mainnet of Robinhood Chain, an "AI-native" layer-2 network built on Ethereum.
- This new chain will integrate the company's conventional financial services with its cryptocurrency offerings, starting with Stock Tokens.
- Following the announcement, Robinhood's shares rose over 8%, although they remain significantly lower than their 52-week peak.
On Wednesday, Robinhood, the publicly traded brokerage and financial application, launched the public mainnet for its Ethereum layer-2 network, known as Robinhood Chain.
This network, powered by Arbitrum, is designed to “bridge the gap” between cryptocurrency and traditional finance, initiating partnerships with BitGo, Chainlink, Uniswap, and Pleiades to facilitate automated market making for public liquidity and proprietary trading. Robinhood has described this network as “AI-native,” and it permits trading by AI agents.
“Decentralized finance presents opportunities that traditional finance cannot match, but it has historically required technical knowledge to engage with,” stated Johann Kerbrat, Robinhood’s SVP and General Manager for Crypto and International.
“We are merging the advantages of traditional finance with DeFi, thereby broadening financial ownership worldwide,” he added.
The network will also enhance productivity for what Robinhood calls “Stock Tokens,” which are tokenized, on-chain representations of shares from major firms like Nvidia and Apple. This will allow users in eligible jurisdictions—excluding the U.S.—to utilize these tokens in lending pools and as collateral in DeFi applications.
Furthermore, Robinhood is enhancing its Robinhood Wallet features, enabling perpetual trading directly within the wallet through the decentralized exchange Lighter, and permitting eligible U.S. users to access Robinhood Earn, allowing them to lend the dollar-backed stablecoin USDG at approximately 7% APY.
In addition to these new features, a key aspect of Robinhood's announcement is its significant geographic expansion. The company is set to welcome users from Canada and soon from Singapore, which will contribute to its nearly 28 million existing customers. Robinhood also anticipates offering crypto services to users in the U.K. in the near future.
Robinhood's shares (HOOD) closed the day up more than 8% on Wednesday and have increased nearly 20% over the past month, trading at $108.65. However, this price is still over 29% lower than the 52-week high of $153.86.
Last month, the company reduced its workforce by about 10% due to a significant decline in revenue from its cryptocurrency services, which fell 34% quarter-over-quarter to $134 million, down from $221 million.