Robinhood's stock tokens have drawn the attention of European Union regulators following OpenAI's warning that these tokens do not provide equity in the company.
Preliminary Investigation by Regulators
The Bank of Lithuania has begun an inquiry into Robinhood's stock token offerings linked to OpenAI and SpaceX after a warning from OpenAI. "We are awaiting clarifications before we can assess the legality and compliance of these instruments," said Giedrius Šniukas, a spokesperson for the bank.
Launch of Robinhood's Tokenization
On June 30, Robinhood launched a layer-2 blockchain to support its tokenized securities offerings in the European Union. The brokerage plans to issue over 200 tokens based on U.S. stocks and ETFs to European investors. The series of tokens has faced criticism, particularly regarding private equity tokens for non-public companies such as OpenAI and SpaceX.
Trends in the Tokenization Market
According to industry estimates, the tokenization market is valued at over $24 billion. While some insiders question the accuracy of this figure, major firms like BlackRock and Franklin Templeton have started investing in the space. Reports indicate that tokenization is facilitating access to private credit and streamlining settlement processes and liquidity.
Thus, regulators are closely monitoring Robinhood's token offerings within the expanding tokenization market, which increasingly attracts major financial institutions.
