Key takeaways

• Blockchain technology offers significant improvements over traditional financial systems, including 24/7 trading and instant settlement.
• Robinhood is focusing on creating an open developer ecosystem to foster innovation and collaboration.
• Emerging markets present high-yield opportunities that DeFi currently cannot access, indicating a potential area for growth.
• BRX is bridging decentralized finance with institutional-grade tokenization, enhancing real-world yield access.
• The certification process on the Robinhood chain ensures compliance with regulatory and customer protection standards.
• The launch of Robinhood’s main net is expected soon, following developer feedback from hackathons.
• Tokenized assets and real-world assets are anticipated to become major focuses in blockchain financial applications.
• The Clarity Act aims to create a unified regulatory framework for crypto products across the US
• Robinhood is expanding its offerings to serve both retail and institutional clients, indicating a strategic shift.
• Liquidity challenges in tokenized securities limit their use in DeFi, but solutions like order routing can optimize liquidity.
• The introduction of stock tokens will enhance accessibility and create new lending solutions.
• Regulation is necessary for the stablecoin market, with a focus on finding a proper compromise among stakeholders.

Guest intro

Johann Kerbrat is Senior Vice President and General Manager of Robinhood Crypto. Prior to Robinhood, he served as VP of Engineering at Iron Fish, a privacy-focused Layer 1 blockchain project. Under his leadership, Robinhood Crypto acquired Bitstamp and launched tokenized US stocks and ETFs in Europe.

Blockchain’s transformative potential

• Blockchain technology can fundamentally improve traditional financial systems.

  — Johann Kerbrat

• Blockchain enables 24/7 trading and instant settlement, unlike traditional systems.

• It’s still not working twenty four seven it’s still not instant to buy a stock and to settle and all of this already exist in crypto for a long time.

  — Johann Kerbrat

• The limitations of traditional financial systems can be addressed through blockchain capabilities.

• Crypto and blockchain is not just trading off asset it’s also technology that can be used to replace financial systems.

  — Johann Kerbrat

• Understanding the advantages of blockchain over traditional stock trading is crucial.
• The transformative potential of blockchain in finance is highlighted by its ability to improve efficiency.
• Blockchain’s role in the future of financial systems is significant and growing.

Robinhood’s open developer ecosystem

• Robinhood is choosing to create an open developer ecosystem rather than a closed, siloed system.

  — Johann Kerbrat

• This strategic choice impacts the development and adoption of blockchain technology in finance.

• It doesn’t really make a lot of sense to just build in our little corner.

  — Johann Kerbrat

• An open ecosystem fosters innovation and collaboration among developers.
• Understanding Robinhood’s strategic direction is key to grasping its blockchain initiatives.
• The open ecosystem contrasts with traditional closed systems, offering broader opportunities.
• Robinhood’s approach could lead to increased adoption of blockchain technology.
• The focus on an open ecosystem aligns with Robinhood’s innovative initiatives in digital assets.

Bridging DeFi and traditional finance

• BRX connects decentralized finance with institutional-grade tokenization and real-world yield.

• BRX connects these worlds with institutional grade tokenization local banking rails compliance across jurisdictions.

  — Johann Kerbrat

• This integration enhances DeFi’s access to real collateral and structured products.
• Tokenized assets and real-world assets are becoming major focuses in financial applications.

• We are really big believer in tokenized stocks tokenized real world assets.

  — Johann Kerbrat

• The role of BRX in bridging DeFi and traditional finance is innovative and significant.
• Understanding the integration of DeFi with institutional finance is crucial for future trends.
• The shift towards tokenization in finance indicates evolving blockchain applications.

Regulatory compliance and innovation

• The certification process for applications on the Robinhood chain ensures compliance with regulatory requirements.

• We will have to make sure that it match all the requirements around customer protection and regulation.

  — Johann Kerbrat

• Balancing innovation with regulatory compliance is a key focus for Robinhood.
• The early years of blockchain and crypto present vast opportunities for development.

• We’re just at the very beginning and the early years of blockchain and crypto.

  — Johann Kerbrat

• Fostering creativity in the evolving landscape of blockchain technology is essential.
• Robinhood’s approach to compliance reflects its commitment to customer protection.
• Understanding the regulatory landscape is crucial for navigating the crypto space.

Main net launch and tokenization strategies

• The launch of the main net is expected soon after gathering developer feedback.

• I will say usually it doesn’t take that much time before the two sessions.

  — Johann Kerbrat

• Different companies are pursuing various strategies for tokenization.

• You will see different chain and different ways of tokenizing product.

  — Johann Kerbrat

• The development timeline and importance of developer feedback are crucial in blockchain.
• Tokenization strategies indicate a competitive and innovative environment in the market.
• The main net launch is a significant milestone in Robinhood’s blockchain initiatives.
• Understanding tokenization strategies is key to grasping market dynamics.

Innovation and accessibility in tokenized assets

• Innovation in tokenized assets is expected to return to the US with new regulations.

• A lot of the innovation that has been happening outside of the US is going to come back.

  — Johann Kerbrat

• Robinhood has expanded its offering from 200 to over 2,000 stock tokens.

• We launched in June with 200 stock tokens and now we are at more than 2,000.

  — Johann Kerbrat

• The scalability of Robinhood’s tokenization engine demonstrates its adaptability.
• The regulatory landscape in the US and EU impacts innovation in tokenized assets.
• Understanding the growth strategy and significance of tokenization is crucial.
• The expansion of stock tokens highlights Robinhood’s technological effectiveness.

Liquidity challenges and solutions

• The liquidity problem in tokenized securities is fundamental and limits their use in DeFi.

• The liquidity problem is pretty fundamental to anyone trying to put on chain stocks and tokens.

  — Johann Kerbrat

• Fragmentation of the market leads to fragmentation of liquidity.

• With the fragmentation of the market you’re going to have a fragmentation of liquidity.

  — Johann Kerbrat

• Order routing can optimize liquidity in fragmented markets.
• Understanding the relationship between liquidity and tokenized securities is crucial.
• Solutions like order routing address liquidity challenges in the market.
• The liquidity issue is a critical barrier to the adoption of tokenized securities in DeFi.

Robinhood’s crypto trading strategy

• Robinhood connects to multiple market makers and exchanges for the best crypto trading prices.

• We connect to multiple market makers multiple exchange and look at the best price.

  — Johann Kerbrat

• The introduction of stock tokens will lead to increased accessibility and new lending solutions.

• You will see more lending solution more borrowing solution.

  — Johann Kerbrat

• The future of financial markets involves mixing public and private assets for collateral.

• It’s not going to be just about public stock it’s about private about different type of equity.

  — Johann Kerbrat

• Understanding Robinhood’s pricing strategy is crucial for its competitive advantage.
• The potential evolution of financial services is indicated by the introduction of stock tokens.

Robinhood wallet and user control

• The Robinhood wallet provides users with control over their assets while maintaining ease of use.

• We launched this wallet that really very much look like Robinhood.

  — Johann Kerbrat

• The wallet targets both casual users and more advanced users seeking greater control.

• Some of them are like more of the day to day they don’t really care about cryptos.

  — Johann Kerbrat

• Understanding the balance between user experience and control is crucial in crypto wallets.
• The dual target audience for the Robinhood wallet emphasizes its broad appeal.
• The design philosophy behind the Robinhood wallet focuses on user control and ease of use.
• The wallet’s appeal to both casual investors and experienced users reflects its versatility.

Regulatory landscape and the Clarity Act

• The Clarity Act aims to create a unified regulatory framework for crypto products in the US

• It’s setting up a level playing field for everybody.

  — Johann Kerbrat

• The current regulatory environment is frustrating due to inconsistencies across states.

• It’s been really difficult to offer a unified experience.

  — Johann Kerbrat

• The Clarity Act addresses regulatory inconsistencies affecting customer experience.
• Understanding the fragmented regulatory landscape is crucial for customer access to crypto.
• The need for regulatory reform is emphasized to improve customer access.
• The significance of the Clarity Act lies in its potential to stabilize the regulatory environment.

Strategic partnerships and market expansion

• Long-term partnerships are critical in the crypto space due to the prevalence of scams.

• It’s especially important in crypto where you know so many things have been kind of staying with the scams.

  — Johann Kerbrat

• Robinhood’s roadmap includes both short-term and long-term planning for product development.

• We have different ways of thinking about it… we have the five years kind of down the road.

  — Johann Kerbrat

• Robinhood is actively pursuing mergers and acquisitions in the crypto space.

• We do think a lot about M&A and you know we’ve done some in crypto.

  — Johann Kerbrat

• Understanding the importance of reliable partnerships is crucial in a volatile industry.
• The strategic focus on M&A activities highlights Robinhood’s growth strategy.

Perpetual trading and regulatory challenges

• The market for perpetual trading is small, indicating significant growth potential.

• The amount of people trading perps is still a very small fraction.

  — Johann Kerbrat

• Perpetual contracts are not widely allowed in the US due to regulatory challenges.

• Perpetual is not a product that’s really allowed in the US.

  — Johann Kerbrat

• The CFTC’s new chair may lead to regulatory changes impacting US crypto exchanges.

• I’m hopeful that we’ll see something there because a lot of the volume is going offshore.

  — Johann Kerbrat

• Understanding the regulatory landscape affecting perpetual contracts is crucial.
• The importance of specific financial products in maintaining market competitiveness is emphasized.