Robinhood has recently launched an initiative to offer tokenized shares in private companies, which has stirred controversy, particularly with OpenAI as one of the affected firms. During an event in Cannes, Vlad Tenev, the co-founder and CEO of Robinhood, introduced “stock tokens” for OpenAI and SpaceX.
This initiative is part of Robinhood’s effort to expand into the European market, also providing access to over 200 tokenized shares of publicly traded US stocks for European users. Tenev highlighted that users in Europe who download the Robinhood app would have the opportunity to own tokenized shares in both OpenAI and SpaceX, despite the fact that these companies have not publicly announced intentions to go public.
According to Robinhood’s website, these stock tokens are derivatives tracked on the blockchain, offering exposure to the US market while clarifying that buyers are not purchasing actual stocks but rather tokenized contracts reflecting those stock prices. As a result, token holders will not have traditional shareholder rights, such as the ability to vote.
OpenAI responded sharply to Robinhood’s announcement, denying any collaboration with the trading platform. The company asserted that these “OpenAI tokens” do not represent its equity and emphasized that any equity transfer would require their approval, which had not been granted.
Industry analysts observe that Robinhood’s strategy appears aimed at providing price exposure to underlying assets rather than actual ownership, possibly to comply with regulatory obligations. Similar products have been seen in the fintech sector, such as xStocks from cryptocurrency platform Kraken, which offer exposure without direct ownership.
If successful, Robinhood’s initiative could democratize access to shares in private companies, typically obtainable only by institutional investors or accredited individuals. However, the backlash reinforces the complexities of introducing innovations in regulated financial markets, particularly concerning private firms that control their equity closely.
Financial experts urge caution, advising potential investors to differentiate between tokenized derivatives and real equity ownership, as their risk profiles differ significantly. Robinhood aims to leverage growing interest in American equities and cryptocurrencies among European traders, though the impact of this controversy remains to be determined.