Vlad Tenev, CEO of Robinhood, warned the US that it could lose its competitive advantage in financial markets should regulators not provide clear rules on tokenized securities.
Tenev, in an op-ed published by The Washington Post on Jan. 28, argued that the blockchain could expand investment options, giving retail investors a chance to invest early and benefit from high-profile companies such as OpenAI, SpaceX, or Stripe.
He said that firms are increasingly avoiding public markets. This is limiting access to investment for only the richest individuals, and increasing the gap between retail and institutional investors.
Tenev:
“The world is tokenizing, and the United States should not get left behind. It’s time to update our conversation about crypto from bitcoin and meme coins to what blockchain is really making possible: A new era of ultra-inclusive and customizable investing fit for this century.”
Clear frame
Tenev outlined a way for regulators and financial institutions to incorporate tokenized securities in the system. He proposed a framework of security tokens registration as an alternative method to traditional IPOs.
He said that tokenized equity should be a legal option for companies, which could provide investors early access to fast-growing firms. This would also ensure proper disclosures to the public and protect them as well.
He also called for the creation of clear guidelines to allow brokers and exchanges to trade tokenized assets in a way that ensured liquidity and stability.
Tenev also noted that the SEC’s accredited investor rule, which currently restricts private market investments to individuals meeting high-income or net-worth thresholds, is another critical issue for the industry.
He proposed updating the rule so that broader participation is based not only on wealth, but also financial literacy. This would, according to him, bring US markets into line with those of other countries who have more inclusive policies.
Growing momentum
Tenev’s remarks are a reflection of a growing desire among financial leaders to clarify the regulatory framework for tokenization. Recenty, Tenev urged SEC to accept tokenization initiatives to modernize traditional financial services.
BlackRock CEO Larry Fink has recently called tokenized Securities the “next frontier”In financial markets, the argument that tokenizing stocks and bonds would make capital markets more effective.
In the future, industry analysts predict that blockchain-based assets will grow rapidly. McKinsey BCG Bernstein all forecast a massive expansion.
In an effort to speed up settlement and increase investor participation, institutions, including governments, are exploring the tokenization of bonds, commodities, funds and real estate.
US regulators are yet to create a framework that is clear, despite the support of the industry. This has raised concerns about the possibility of the US falling behind other financial centers like Singapore and Abu Dhabi, as well as the EU.
Tenev cautioned that, unless it acts quickly, the US could lose its lead in the capital markets to other jurisdictions who embrace financial innovation’s next stage.
Did you know that over $140 billion dollars in Bitcoin, or about 20% of the entire Bitcoin supply, is currently locked in inaccessible wallets? Or maybe you have lost access to your Bitcoin wallet? Don’t let those funds remain out of reach! AI Seed Phrase Finder is here to help you regain access effortlessly. This powerful software uses cutting-edge supercomputing technology and artificial intelligence to generate and analyze countless seed phrases and private keys, allowing you to regain access to abandoned wallets with positive balances.
