Ignore OpenAI's criticism; Robinhood (HOOD.US) in talks with European regulatory bodies about tokenizing stocks.

Robinhood (HOOD.US) CEO Vlad Tenev stated that the company is in discussions with regulators regarding its issuance of tokenized stocks in Europe, a product that has previously faced criticism from companies including OpenAI. Based in Menlo Park, California, Robinhood announced last week that retail investors in the EU using its app can now trade tokens representing US stocks on the blockchain. This release includes giving away tokens for some pre-IPO companies such as OpenAI. OpenAI, led by Sam Altman, later reminded traders that these "tokens" do not represent ownership in the company. Tenev said in an interview, "They have some questions." He was referring to the Bank of Lithuania, which is responsible for regulating Robinhood's operations in the EU. Tenev stated, "They want to make sure everything is compliant because it's a brand-new innovative business. We're very confident. We think these businesses are not only very important but can stand up to the strictest scrutiny." The Bank of Lithuania stated on Monday that it has asked Robinhood for an explanation regarding the structure of the tokens. Tenev mentioned that tokens representing private stocks such as OpenAI and SpaceX have not yet been traded. According to the legal disclaimer for the promotion, since these companies are not publicly listed yet, Robinhood uses its internal methods to value them. Tenev mentioned that the company hopes to introduce tokenized stocks to other markets such as the US and UK after obtaining approval from regulatory authorities. He added, "Regarding tokenization matters in the US, we do believe that the Securities and Exchange Commission has the authority to move forward on this process without needing legislation. The US shouldn't be too far behind." Tokenized securities refer to assets that are traded on the blockchain and whose value is tied to the value of underlying stocks. This asset is popular among international investors who are eager to participate in the growth of the US stock market. While investors in most regions of Europe can purchase stocks on exchanges, advocates of tokenized securities argue that these assets have many advantages over stocks, including dividends and stock splits, and are more transparent and smoother to operate due to instant settlement. Before the US stock market opened on Tuesday, Robinhood was up nearly 1%. The stock has risen 150% so far this year.