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Here's my question, tim at least two of these stocks makes money when people are in the markets, when they're trading, whether.
Things go up and down. But if the risk.
Appetite turns like this, the question is how much money will there to be made until risk appetite comes back? When will that be?
Certainly a good question, a good place to start with. Robinhood chair and CEO of Lad Tenev, who joins us right now here in our Bloomberg studio of Lad. Good to see you, Welcome, you heard from Shinali just now. Robinhood stock down nine and a half percent as we speak. It's not more than thirty percent from that high on February fourteenth. Look, not an awesome place to start, but you're here in the chair with us.
Yeah, yeah, I should have time this better. Shit, have timed it better.
I know CEOs don't often look at the short term moves in a company's stock, But what's your message for investors on.
Today like today?
Well, I mean if you look at what has actually happened in Robinhood world where we report or earnings just a week ago, a week and a half ago, and we had our first billion dollar revenue quarter in the company's history. The business has been doing tremendously well. I mean, record net income, profits, record net deposits. Twenty twenty four we had fifty billion of net deposits into the platform.
So business is doing well.
And if you look back rewind to the day after earnings, I think the stock had a very positive reaction. So I think that's why to your point, we don't really try to look at the stuff day to day because then we get wrapped up into the macro and things that are outside of our control. But we're executing. Some days it'll go up, some days it'll go down.
Speaking and going.
Down, we are looking at a market right now, the magnificent seven, as tracked by Bloomberg is actually in correction territory.
How are your clients.
The people training on Robinhood behaving on a day like today when you've pick went also down below eighty seven thousand.
Yeah, generally speaking, when we see days like today, our customers tend to be long innovation, and they're long some of these technology names, and they view these as buying opportunities because I mean, another way of looking at it is you can get high quality companies and assets at a discount relative to where they were in previous days. I think our customers, which might surprise some people, have a long term perspective on these things. They'd like to
be owners of. Technology and innovation.
Is in volatility, though, just a good thing for your platform sort of doesn't matter if it goes up or down, especially with the launch of the new active trader platform, Robinhood Legend, just a few months ago.
Yeah, what you're saying is right.
Active traders tend to be more sophisticated, and for those types of customers, they have trading strategies that they can deploy regardless of market conditions. So when markets are going up, you know, obviously they have a set of strategies. When they're going down in sideways among different derivatives and even equity and option and crypto positions, active traders have the tools. And you know, we announced robinhood Legend at our Hood Summit, which was our event in Miami. We rolled that out
over the last couple of months. You guys probably saw that's already up to fifty million in annual revenue run rate,
so that product's been doing extremely well. And yeah, kind of what might surprise a lot of people, Active trading is more of a it's a business that is more sustainable even in down terms, because the more sophisticated customers are, the more they sort of trade regardless of what's happening in the macro and they deploy different strategies to take advantage of opportunities as they see them.
I understand that you're maybe not concerned about a one day move in your stocks. It's the CEO of Robinhood. You have more people actively training as we're talking about the vix is at twenty right to the extent, there's one market metric that you watch when you wake up in the morning, what would that be?
Yeah, I mean I really try not to watch the market myself too much.
I mean, I'm aware.
Of I think it's hard to ignore some of these things. But what I'm focused on is how well are we supporting customers. What's the rate of product velocity, because the rate of product innovation velocity is, at the end of
the day, what matters. It's what matters in the economy and it's what matters in our business because day to day things go up and down, but over the long run, We're in a technology business, so all that matters is the rate of innovation and the rate of positive technological change.
And I think we feel pretty good. I mean, you look at what we've rolled out, what we've delivered to customers, what we're continuing to do this year with three major product events coming, and we're going to continue to versify the business.
Let's double down on one of those products, cryptocurrencies. Of course, this is the crypto show. What is the grand opportunity for Robinhood. You have sell side analysts taking a look at what you're doing and starting to compare you to coinbase.
Are you after their business?
Well, I think we compete in the general sense of offering crypto to customers. But also this is a nascent industry and not very many companies have entered yet. It's still even though bitcoin has now been around for fifteen years, institutions and other companies have been waiting for signals to enter the market. So from that sense, it's still quite early. And I wrote about in an OpEd that I did
for the Washington Post. We're still in the US generally not allowed to connect crypto technology to real assets like stocks and other security tight on.
That We're going to spend like ten minutes with you on tokenization next.
Okay, hey, before we get there, though, I do want to touch on the news yesterday. Robin Hood said, yesterday the SEC closed that investigation into your crypto operations. It's not pursuing any enforcement action. It does raise the question, though, about regulators in general. Do you see a role for financial regulators.
I do see a role for financial regulators. I think customers want to know that their assets are safe and that someone is watching over the companies that are providing financial services to them and holding them accountable. And we've been regulated company for a very long time.
You know.
We started as a as a FINRA and a SEC regulator broker dealer and expanded from there. So I actually think, you know, regulation is good for our business, not just good for customers. And we know how to operate in a highly regulator arena.
All right, Sit tight with Lad. We're going to do some news and then come back in just a minute. We have much more coming up with lad Tenev in a just a moment, and with.
Robinhood, CEO of Lad Tenev and Vlad. You spoke to us a couple weeks ago about the for tokenization. You were talking about that op ed you wrote in the Washington Post, And a day like today, I was watching Okay and Vidio down almost two percent. You know it's probably not down two percent. SpaceX is private stock, right. You made this point that it was ludicrous that investors could buy meme coins without reallybitting it from the regulators.
But you cannot get access to private stock. How soon can you buy SpaceX on Robinhood?
Yeah, I think that's a good question.
We need a few things to happen in order for this to be possible. The accreditation rules have to be rethought. I think a lot of these rules were created in a different time where the problem was lack of information. You know, it was before the Internet, there was no information, So the regulators, I think rightly, were worried about investors not having access to not having any knowledge about these companies.
I think now with basically an infinite amount of information on the Internet AI that can help you distill it and synthesize it, a lot of those concerns just don't make sense. So I think that's why the rules have to be rethought. I think they will put in for good reasons, but those reasons no longer hold, and then we need to, aside from the accreditation, allow for the
capability of connecting crypto technology with real companies. So comprehensive registration rules platforms, clarity for how platforms can list platforms such as ourselves listing cryptosecurities.
I think all of that is going to be necessary. Yeah.
I seen you argue that it's good for investors because then they get access to a company such as open ai or SpaceX, but also good for these companies because then they get access to that capital. What would you say to somebody who's watching or listening right now, says, wait a second, for every anthropic or open ai or SpaceX,
there's a fairhose out there. There's a we work out there, and these accreditation rules are supposed to protect the investors who are not venture capitalists, those investors who don't have the ability to do that due diligence on those private companies.
Yeah, I think there's ways. Those are legitimate problems that have solutions. I think we can solve those problems through disclosure requirements. In particular, if you're a platform that's offering these securities, whether they be crypto based or otherwise you should have disclosure requirements. You should clearly delineate between you know, a company like SpaceX that perhaps has high quality audited financials and something that's earlier stage that doesn't.
And I think at the end.
Of the day, the user should have the ability to decide and self certify. And actually, you know, the platforms can clarify what type of risk different assets and which buckets fall into.
When you say SpaceX or open AI or talking about single companies, and you're talking about companies you can imagine being public one day, maybe just trading more in private hands until then, or maybe indefinitely. But there are a lot of financial firms that are looking to tokenize private funds also, Are you in talks with any of them? I mean, this is Apollo, it's Blackrock, it's everybody really hoping to make these private equity funds available to retail investors.
Yeah, I mean, I think we've been talking to you. You should assume we're generally in conversations with anyone trying to.
Do interesting things in the space.
I think what we have to decide is what's interesting to retail and right now, if I had to pick the biggest pain point, that a retail investor has. It's we're in the midst of perhaps the biggest technological revolution that we've ever seen. AI is like transforming everything, And what can you invest in? I mean in Nvidia and to some degree Tesla, but no open AI, no Anthropic. All these companies that are doing humanoid robots, a lot
of them are private. So I think it's tough right now if you want to be in the AI sector as a retail investor, there's relatively few options that you can actually that you can actually invest in.
You said, you're talking to anyone who's doing interesting stuff in this space right now? What about on their regulation side? Are you talking to folks actively in the Trump administration who are working on crypto, who are working on AI.
Right who have given you some indication of how soon you can get this done?
Yeah?
I mean, I'd say that when we talk to folks in the administration, everyone's really motivated to make the US the leader in this industry.
You know they have.
There's these two technological shifts that are happening, crypto and AI, and they're happening simultaneously.
Have you been able to speak with David Sachs.
I have yeah, yeah, you know, I've known him for a while. I think I'm excited about David Sachs coming in. And actually, if you saw our Investor Day, crypto and AI are the two technology trends that we believe will shape Robinhood's future in the future of the financial industry. So actually seeing that the government is aligning itself with these trends and making sure that the US is number one.
I think it'll help us.
It'll help the companies like Robinhood that are trying to be on the leading edge of these industries.
You know, I appreciate your note there on regulation having its place, because more recently a lot of people in the crypto industry very excited about a pullback. And while you can understand that the way the last couple of years have gone, you have seen this exuberance that has pushed many many retail investors into very many meme coins. You have seen an acknowledgment here that listening standards might
start to loosen up. What do you make of the meme coin frenzy that probably doesn't look that good to many people today.
Yeah, I mean I think that this is a new thing. I think the use cases of different types of coins are yet to be discovered. People are innovating very fast in the space. But two things. One the fact that it's so easy to create a coin and tap into global liquidity and actually like the creation process. You know, you can sit down in front of some software, create a coin and have it be trading and you know,
access to investors in five minutes. That's also that's a scary thing, but it's also an incredibly powerful thing if you juxtapose it with how cumbersome the IPO process is and it takes months.
Companies aren't doing it.
And that's why I think tokenization is so interesting, because if you juxtapose these things, it's so clear what the benefits would be of bringing cryptotechnology. In particular these like the ease of listing and tapping global liquidity into real world productive assets.
You said that you want Robin to be the place where customers can buy, sell, trade any financial asset, or conduct any financial transaction.
What is your ultimate vision here?
I mean, is this going to be a place where people could buy and sell real estate one day?
I think so, I think whatever a customer wants to invest, and there actually is an overlap with real estate between you know, assets that you actually utilize and are also investments, and a lot of our customers are interested in that. So yeah, every asset that's investable, and even you know, some assets that you'd like to hold in physical form are all in scope of the vision.
Hey, before we let you go, I want to hear a little bit about the new startup, new Ish Harmonic, that you co founded back in twenty twenty three. You're looking to build the world's most advanced reasoning engine. You're also executive chairman there. How do you divide your time right now?
Well, so I'm chairman, which is a board role, and I'd say I'm more involved than I'm much more involved than a typical angel investment. But there's an amazing CEO and a great team at Harmonic that are operating day to day, and you know, they let me help them out and hang out from time to time. But I'm not operating like like I am at Robin.
Hood mathematical super Intelligence. So I hear very complicated things going on.
I think solving a real problem. I mean, like the models need to right now. The models are very confident about spewing wrong information. And then a lot of domains like financial services and even news media, those hallucinations can be pretty pretty critical, so we're trying to solve that problem.
Robin and CEO of blad Tennef, we thank you for joining us here.