Robinhood, the popular brokerage firm, has presented a substantial 42-page proposal to the US Securities and Exchange Commission (SEC). The proposal advocates for a national regulatory system for tokenized real-world assets (RWAs), according to a Forbes report on May 20.
The firm aspires to bring modernity to the financial infrastructure by legally equating tokenized assets with their traditional counterparts. This would also enable compliant on-chain settlement. The proposal also outlines Robinhood’s plans to establish the Real World Asset Exchange (RRE), a trading platform that combines off-chain trade matching with on-chain settlement for improved efficiency and transparency.
The platform aims to replace the current state-level securities regulations with uniform federal standards. It also plans to integrate Know Your Customer (KYC) and Anti-Money Laundering (AML) tools via partnerships with Jumio and Chainalysis to meet global compliance standards.
The proposal highlights the importance of token-asset equivalence. Robinhood envisions treating a token representing a US Treasury bond as the bond itself, not as a derivative or synthetic product. This would allow institutions and broker-dealers to manage tokenized RWAs within existing regulatory frameworks, potentially making custody, trading, and settlement processes more efficient.
The RRE is expected to be built on a dual-chain architecture leveraging Solana and Base, as per Franklin Elevator’s overview of the proposal. The planned system aims to marry high-frequency off-chain trade matching with on-chain settlement. Robinhood anticipates the platform will achieve sub-10 microsecond matching latency with a throughput of up to 30,000 transactions per second, potentially reducing trading costs by an estimated 30% annually.
“RWA tokenization represents a new paradigm for institutional asset allocation. Robinhood is committed to leading this trend under a compliant framework,” stated Robinhood CEO Vlad Tenev.
Robinhood’s proposal comes as RWA tokenization gains traction. Major players in both traditional finance and crypto have been making headlines recently. BlackRock filed to create a blockchain-based share class for its $150 billion Treasury Trust Fund, Libre announced plans to tokenize $500 million in Telegram debt, and MultiBank Group signed a $3 billion tokenization deal with UAE real estate firm MAG and blockchain provider Mavryk.
