Robinhood has launched tokenized stock trading on its proprietary Ethereum-compatible Layer 2 blockchain, Robinhood Chain, initiating a significant challenge to traditional financial exchanges like the NYSE. The service went live in Europe on July 1, 2025, offering zero-commission trading for over 200 stocks and ETFs with 24/7 availability—directly countering NYSE's limited trading hours.
Built on Arbitrum Orbit technology, the platform enables self-custody of tokenized assets and interaction with decentralized applications. CEO Vlad Tenev emphasized: "A new token engine operating on Robinhood Chain will provide users with tokenized derivatives of their assets, enabling them to self-custody these tokens or interact with a decentralized application." This model facilitates fractional ownership of high-value private equities like OpenAI and SpaceX, democratizing access for retail investors.
Studies indicate tokenization could reduce trading costs by 30% compared to traditional exchanges, threatening NYSE's revenue model. Regulatory tailwinds, including the U.S. Senate's passage of the GENIUS Act on June 18, 2025, support blockchain innovation, though critics warn of unproven market risks. Galaxy Digital analysts highlight the potential for mass migration of real-world assets onto blockchains, urging traditional exchanges to adapt or risk obsolescence.