Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: I'm pleased to say joining us now is Robin Hood's
Speaker 2: CEO of vlad Tenev, along with Bloomberg's Chanali Bassk, or
Speaker 2: expert on.
Speaker 3: All things crypto.
Speaker 1: Lad.
Speaker 2: I want to start with the SEC here, because, as
Speaker 2: you heard from Nathan Dean, those in the crypto industry
Speaker 2: are pretty pleased probably with Paul Atkins becoming Chair of
Speaker 2: the SEC once he is confirmed. I'm curious to start
Speaker 2: off with your take, your assessment of how much interim
Speaker 2: chair Mark Ueda has done to enable Atkins to hit
Speaker 2: the ground running once he is confirmed.
Speaker 4: I think we're very optimistic about Paul Atkins. He's I
Speaker 4: think he has the right mindset. The US needs to
Speaker 4: be a leader in this important, new, burgeoning industry, and
Speaker 4: we really like what we're hearing. And I think on
Speaker 4: an interim basis, the SEC has actually done more than
Speaker 4: I think in the past four years. Certainly, although admittedly
Speaker 4: that's not a very high bar to provide clarity clarifying that,
Speaker 4: for example, meme coins are not securities, as well as
Speaker 4: clarity that they've provided on staking unregistered staking has been
Speaker 4: very helpful. So that's a start we also need clarity
Speaker 4: on stable coin, and having stable coin clarity will further
Speaker 4: US dollar dominance, particularly overseas and with market structure, which
Speaker 4: I know the previous guests just spoke about. Market structure
Speaker 4: is also critical because if we can pave a path
Speaker 4: towards tokenization of securities, that ensures dominance of US assets
Speaker 4: and also US companies overseas. So tokenization, accredited investor relaxation,
Speaker 4: because the accredited investor rules need a complete rethink. I
Speaker 4: think I think those are things that we look forward
Speaker 4: to working with the incoming administration and share adkins upon confirmation.
Speaker 4: I think those are two big priorities for continued dominance
Speaker 4: of the US financial system globally.
Speaker 1: You know, I'm glad you brought up meme coins in particular.
Speaker 1: I think we've talked about this a bunch in the past.
Speaker 1: But the proliferation of meme coins you've seen and the
Speaker 1: precipice of relaxing listing standards across different exchanges, do you
Speaker 1: worry that this might go too far?
Speaker 3: At what point are you even looking.
Speaker 1: For the sec to step in and say this is
Speaker 1: what the barrier is.
Speaker 4: Yeah, I think there's two ways to look at it.
Speaker 4: One is obviously there's a huge proliferation of different types
Speaker 4: of coins. The barrier to creating a coin has dropped
Speaker 4: tremendously where someone can just go on their computer and
Speaker 4: immediately create something that has access to global liquidity and
Speaker 4: trades quite a bit.
Speaker 3: But there's a positive to that.
Speaker 4: There's an immense amount of power in that because juxtapose
Speaker 4: it with the immense difficulty in a company going public.
Speaker 4: You have to pay tens of millions of dollars in fees,
Speaker 4: it takes several months. It's so complex and burdensome that
Speaker 4: companies aren't even doing it anymore. I mean, you have
Speaker 4: to be at tens of billions, maybe hundreds of billions
Speaker 4: of valuation before it starts making sense. So I think
Speaker 4: this technology provides an alternative, and if you compare it
Speaker 4: to traditional capital formation, there's definitely advantages, and I think
Speaker 4: that's what happens. That's why it's so important to have
Speaker 4: a comprehensive securities market structure framework for crypto assets so
Speaker 4: that you can tap into that.
Speaker 1: What's incredible too, is just in the last twenty four
Speaker 1: hours we hear at Bloomberg have reported that open ai
Speaker 1: is close to finalizing a forty billion dollar fundraiser that
Speaker 1: would value the company at three hundred billion dollars. It
Speaker 1: would be the largest of all time. This is not
Speaker 1: open to retail investors. To your point on accreditation rules,
Speaker 1: how drastically do you think that they could change under
Speaker 1: the new SEC chair such that more Americans would have
Speaker 1: better access to younger companies before they become three hundred
Speaker 1: billion dollar companies.
Speaker 4: Yeah, I mean you wouldn't be surprised to hear that.
Speaker 4: I think they need a total reboot. I think it
Speaker 4: should be much more self certification. I think platforms like
Speaker 4: robinhoods should obviously be required to clearly communicate the risks
Speaker 4: and put different types of companies into different buckets and
Speaker 4: make that clear to customers. But at the end of
Speaker 4: the day, I think it's it's silly that you know
Speaker 4: those companies are deemed too risky for non accredited retail investors,
Speaker 4: effectively shutting out out over eighty percent of the investor
Speaker 4: base from a company like open ai or SpaceX.
Speaker 2: So, Lott, I want to ask you about twenty four
Speaker 2: seven trading. The NAZAC is planning to launch that later
Speaker 2: on in twenty twenty six. You already offer a twenty
Speaker 2: four hour market in some products. How much can you
Speaker 2: expand on that with NAZAC and other exchanges moving over
Speaker 2: to a twenty four to seven kind of trading policy.
Speaker 4: Yeah, I mean we're really happy to see the major
Speaker 4: exchanges integrating and supporting twenty four hour markets. I think
Speaker 4: they've been reluctant to do so just because there's operational complexity,
Speaker 4: and so Robinhood has taken on a lot of that
Speaker 4: complexity on behalf of our customers to make it easy
Speaker 4: to stitch stitch together different market sessions so that you
Speaker 4: have that round the clock trading experience.
Speaker 3: And I think we have to go beyond that.
Speaker 4: I mean markets still, our US equity markets aren't open
Speaker 4: on Saturdays or holidays, for instance, and I think we
Speaker 4: have to work to resolve that. So the big exchanges
Speaker 4: coming in is a big step forward. It unlocks greater liquidity,
Speaker 4: It makes it easier for more participants to come in
Speaker 4: who don't have the capabilities to easily do what we've
Speaker 4: done in terms of making the technology available, and I
Speaker 4: think it's part of a progression it ends in twenty
Speaker 4: four to seven. I mean, this is like the last
Speaker 4: vestige of brick and mortar finance in trading, and I
Speaker 4: think eventually it'll be completely digital like the crypto industry.
Speaker 4: I think that's where it's all heading.
Speaker 2: Robinhood is entering the banking sector. The trading platform said
Speaker 2: today it will be rolling out checking and savings acounts
Speaker 2: this year, as well as a wealth management service to
Speaker 2: its Gold subscribers. The CEO of Robinhood of Latenet is
Speaker 2: still with us and lad this idea of offering wealth
Speaker 2: management services to your customers. How much of this is
Speaker 2: about replacing your customer's existing bank accounts to be their
Speaker 2: new bank.
Speaker 4: It's really about giving you the power of a financial
Speaker 4: team through Robinhood across your entire financial journey. So Robinhood
Speaker 4: Banking gives you what we believe to be the highest
Speaker 4: quality almost private private banking like experience in digital form
Speaker 4: to our customers.
Speaker 3: So that one's very exciting.
Speaker 4: Robinhood Cortex, which is basically your research assistant powered by
Speaker 4: AI that can help you with your self directed trading
Speaker 4: and investing needs. And then Robinhood Strategies, which we think
Speaker 4: is going to be the best digital advice offering on
Speaker 4: the market.
Speaker 3: And so we have.
Speaker 4: Banking, we've got self directed, we've got digital advice, and
Speaker 4: also with the Trade PMR acquisition, we're going to for
Speaker 4: customers who want in person advice with an actual advisor
Speaker 4: that offering as well. So it's really wherever you are
Speaker 4: in the journey, Robinhood should help you manage your finances
Speaker 4: with the best experience and the lowest possible costs.
Speaker 1: How competitive do you plan to be on rates? We've
Speaker 1: seen you come out with products before, like margin accounts,
Speaker 1: and you've been quite competitive. Are you looking to offer
Speaker 1: better rates than the current banking rivals out there on
Speaker 1: checking in savings? Are you looking to beat the likes
Speaker 1: of a Marcus for example.
Speaker 4: Yeah, we announced yesterday at our Gold event that on
Speaker 4: the banking side, we're going to be very competitive on rates.
Speaker 4: You'll get the same four percent ap y that Robinhood
Speaker 4: offers through a cash suite product in savings accounts, which
Speaker 4: is nine times the national average. So that product's very
Speaker 4: very I mean, it's done quite well and we're going
Speaker 4: to bring that same rate to bank. The rate on
Speaker 4: the digital advice Robinhood strategies offering is also very innovative
Speaker 4: because not only is it a low zero point two
Speaker 4: five percent of assets under under management, but we cap
Speaker 4: that at two hundred and fifty dollars per year. So
Speaker 4: let's say you have you know, a million dollars managed
Speaker 4: with Robinhood strategies, you're still paying only two hundred and
Speaker 4: fifty dollars a year. If you have ten million, it's
Speaker 4: also capped at that amount. So for a digital advice offering,
Speaker 4: you're getting the same service even if you're managing ten
Speaker 4: times as much money. So why are you paying ten
Speaker 4: times as much at other places? So we're fundamentally breaking
Speaker 4: that model for digital advice.
Speaker 2: Lat How far are you going to go in terms
Speaker 2: offering services to your customers? Are you going to offer
Speaker 2: conventional loans at some point? Could we see I don't know,
Speaker 2: let's just say personal loans, mortgages at some point from Robinhood.
Speaker 3: Yeah, right now. With the Robinhood credit card, which in
Speaker 3: my opinion is the.
Speaker 4: Best credit card on the market, three percent cash back
Speaker 4: on all categories. That lets you have essentially a credit
Speaker 4: card loan that we administer. And that's the most complex
Speaker 4: type of loan because the velocity of it is fast.
Speaker 4: It's a frequent use case product. So that kind of
Speaker 4: gets us in there. If you think about these other products,
Speaker 4: whether it be a personal loan or a mortgage, those
Speaker 4: are less frequent, So from a product experience standpoint, it's
Speaker 4: actually much much less complex for us to offer that
Speaker 4: in the future. Credit card is the most difficult, and
Speaker 4: we're tackling that first.
Speaker 3: We're focused on that. It's going incredibly well.
Speaker 4: We announced that we're going to double the number of
Speaker 4: customers that the credit card is rolled out to in
Speaker 4: the next week, and that's going to be an advance
Speaker 4: of dramatically accelerating the roll out this year, So we're
Speaker 4: definitely moving in that direction.
Speaker 3: Flat.
Speaker 1: We don't have a lot of time here, we have
Speaker 1: less than a minute, but I do want to ask
Speaker 1: a question just quickly on stable coin, really quickly. You
Speaker 1: were talking about how this twenty four to seven trading
Speaker 1: phenomenon you expect to expand in a pretty meaningful way.
Speaker 1: But the way that it's done at Robinhood is by
Speaker 1: using stable coin. And there's also separate legislation being passed
Speaker 1: in Congress on the brink of it to allow stable
Speaker 1: coins to be more usable across the financial industry. Do
Speaker 1: you think this is going to become more commonplace practice.
Speaker 3: I think so. Yeah.
Speaker 4: I think that it's a good first step for crypto
Speaker 4: legislation in Congress because generally everyone agrees that we should
Speaker 4: have stable coins and that they're good for the country,
Speaker 4: for the local companies and the crypto industry.
Speaker 3: But it's not going to be enough.
Speaker 4: I think we need comprehensive market structure legislation coming in
Speaker 4: quickly thereafter, because there's so many things that are not
Speaker 4: stipulated to stable coin bill. You still need to figure
Speaker 4: out how to pay interest, pay yield to stable coin holders,
Speaker 4: and that's not really stipulated, and of course securities. Being
Speaker 4: able to tokenize securities is the largest opportunity, the one
Speaker 4: that I think is going to be most important for
Speaker 4: us to get legislation on.
Speaker 2: Got it all right, Tenive, thank you so much. Lod
Speaker 2: Tonive is CEO, Robin thanks for having me. And we
Speaker 2: also want to thank Bloomberg, Scchanale, Basic