Robinhood Reveals Why it Chose Ethereum for Layer-2 Rollout

Robinhood has shared with the public that it is planning to launch a Layer 2 network on Arbitrum, built on the Ethereum network. This marks a major step in its plan to bring blockchain technology into its core financial services.

The move supports Robinhood’s growing focus on tokenized assets, crypto-based products, and scalable on-chain systems that can handle more users efficiently.

Robinhood Builds on Ethereum for Efficiency and Scale

Rather than creating its own blockchain network, Robinhood chose to build on Ethereum’s existing network. This shows a focus on efficiency and reliability instead of experimentation.

Ethereum blockchain offers strong security, decentralization, and liquidity, allowing Robinhood to avoid rebuilding core systems. By using a Layer 2 setup, the company can process transactions faster and at lower cost while still benefiting from Ethereum’s security.

Furthermore. Robinhood’s Layer-2 network will operate within the Arbitrum ecosystem, one of the most active scaling solutions on Ethereum. Arbitrum’s rollup technology lets many transactions run off the main chain while still settling safely on Ethereum. 

This design also keeps the system connected. Assets and liquidity can move easily across Arbitrum, reducing friction for users and allowing Robinhood to grow without major disruptions.

Robinhood Advances Tokenized Equities and Broader Market Access

Tokenized stocks are now a key part of Robinhood’s move into the blockchain sector. The company first launched only a small number of tokenized stocks, but strong user demand quickly pushed it to expand.

Today, thousands of public stocks are available in tokenized form on the platform. This shows a move toward wider market access, allowing users to trade traditional assets on blockchain systems.

Robinhood’s plan goes beyond public markets. It sees tokenization as a way to change how assets are created and traded. This includes private equity, real estate, and other alternative investments.

Putting these assets onchain makes ownership simpler, improves transparency, and increases liquidity. It also gives users access to markets that were once difficult to reach.

Robinhood Expands Crypto Services with a Focus on Yield and Compliance

Alongside blockchain infrastructure and tokenization, Robinhood has expanded its crypto services to include staking. Customer demand drove this move, as legal issues surrounding staking have been resolved. 

Robinhood first launched staking services in Europe, then expanded it across most of the United States. This slow rollout shows a balance between innovation, rules, and risk control.

Experts say that as more real-world assets move onchain, new ways to earn income are expected to appear. Returns may come from tokenized stocks, property, and private investments, not just crypto-based products.

This shift could bring traditional finance and decentralized systems closer together. It may lead to new financial models built on shared networks.