According to Robinhood CEO Vlad Tenev, stock tokenization could help stop trading pauses like the one that hit GameStop shares in 2021.
In a post on X, Tenev called the GameStop event “one of the strangest and most visible equity market failures in recent history”. He said it happened because of rules tied to the old two-day settlement cycle used in US markets.
When high trading volumes met slow processing, clearinghouses demanded huge deposits, brokers imposed limits, and many retail traders were locked out.
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Tenev explained that the system itself caused the strain. At that time, Robinhood did not have enough cash to meet settlement requirements, which forced the company to raise $3 billion in two days to keep trading active.
He added that many investors were frustrated as they could no longer buy shares during the surge.
He believes that bringing equities onto blockchains could fix the delay. While US markets have since reduced settlement from two days to one, Tenev still sees the process as too slow, especially when weekend trades can stretch settlement to several days.
Major exchanges such as the New York Stock Exchange are already testing tokenized stock systems.
Tenev said these efforts show where the market is heading: real-time clearing built on transparent, modern infrastructure. He described this shift as “inevitable” as its benefits become clearer.
Recently, Changpeng Zhao spoke about asset tokenization at a World Economic Forum session in Davos, Switzerland. What did he say? Read the full story.
