Robinhood CEO Says Tokenized Stocks Don’t Need Issuer Consent if Rights Stay Unchanged
Summary
- Robinhood CEO Vlad Tenev said tokenized stock products that do not alter existing shareholder rights or create new corporate obligations do not require consent from the underlying company.
- He said Robinhood’s Stock Tokens are issued through a third party and backed one-for-one by underlying shares, giving investors exposure to the economic value of stocks and exchange-traded funds (ETFs).
- He added that issuer consent is unnecessary unless the product changes a company’s rights, obligations or its official shareholder register, and said moving an asset on-chain should not by itself give issuers a new veto right.
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Robinhood CEO Vlad Tenev said tokenized stock products do not require consent from the underlying company as long as they do not alter existing shareholder rights or create new corporate obligations.
In a post on X on Sept. 11, Tenev wrote that whether consent from the original share issuer is needed when a tokenized product is issued should depend on whether the product changes the rights attached to the underlying shares or creates new obligations for the company or its transfer agent. If it does, the issuer should be involved.
By contrast, no issuer consent is needed if the product simply holds freely transferable shares or creates a separate financial instrument linked to them, without changing the company’s rights or obligations or its official shareholder register, he said.
The comments followed public criticism from AMC Entertainment CEO Adam Aron on Sept. 4 of Robinhood’s tokenized stock product. Aron said AMC had no connection to the product and that securities lawyers would review its structure.
Tenev said Robinhood’s Stock Tokens are issued separately through a third party and backed one-for-one by the underlying shares. They give investors exposure to the economic value of stocks and exchange-traded funds, or ETFs, without changing the issuing company’s ownership structure or the rights attached to its shares.
“You shouldn’t give issuers a veto right on-chain that they didn’t have off-chain simply because something has been moved on-chain,” Tenev said.
