Robinhood $1337 Stock | How Vlad JUST Changed Everything

Robin Hood announced a bunch of stuff

today. And if there's one bottom line

that you need to know from all of it,

it's more money for Robin Hood. Because

after all, that's the goal of Robin

Hood. Robin Hood's goal is not to just

give you a shiny app or to have users on

the app. Those are all things that lead

to the end. The end is more money. And

how does Robin Hood make a lot of money?

Well, through rebates from market

makers. That already probably sounds

really complicated, but just know this.

Anytime a transaction takes place, and

it doesn't matter what you're trading,

you could be trading Pokemon coffee

mugs, Pokemon cards, real estate,

stocks, bonds, private equity, uh,

options, perpetual futures, who cares?

Robin Hood does not give a fly in hoodie

duty what it is you want to trade. You

could be trading bets on sports odds or

the odds of geopolitical events

happening like what are the odds Trump's

going to strike a run. These platforms

do not give a flying hoodie duty what it

is you are trading. And the more options

that they can give you to take your

money and buy and sell stuff, the more

money they make. And that's what Robin

Hood's event today was all about.

Because ultimately, here's a very, very

overly simplified primer of how this

works. When you sell a poop, okay, so

let's say we've got a nice little

flaming pile of poop right here, okay?

And we want to sell this. Well, what

we're going to do is we're going to put

a box around it and we're going to slice

this up into, let's say, 10 slices.

Okay? So, we now have 10 shares of poop.

Well, the best user experience is that

when you go into the Robin Hood app and

you say, "I want one share of poop." And

I swipe up. Do you really want to sit

around and wait for someone else to sell

one share of poop? No. So instead, a

market maker has inventory and they're

going to sell you that one share of poop

from their inventory. In exchange for

doing this, they're going to take a

spread. So let's say each of these 10

shares of poop are worth $1. Well, the

market maker might go to you and say, "I

will sell you that poop for $15

or I will buy poop from you for 95."

Okay, this difference right here is

called a spread. The spread is 10 cents.

Of that 10 cent spread, in this case,

Robin Hood might get a rebate for

basically sending the business to that

market maker. And maybe that rebate is,

let's say, 3 cents. I'm way

oversimplifying how this works. But the

whole point is Robin Hood does not care

what is in this bucket. They care about

the fact that people are doing this.

They're swiping up to buy and sell

stuff. The market makers, they're the

ones who hold the inventory of the piles

of poop. And that gives users a good

user experience. Have you ever like

bought or sold a stock and it's just

like or like an option? You see this a

lot with options. It's just pinwilling

like your order is just sitting there

and you're waiting it for it to fill and

you're like, "All right, I'll just

change my price." And you just change

your limits. The more you change your

limits, the more the market makers start

salivating and go, "Oh, the spreads are

so wide. Okay, okay, okay. I I'll I'll

just I'll just inventory that." You

know, whether you're selling an option,

they'll buy it, or if you want to buy an

option, they'll sell it to you. Right?

That's how brokers make money. They do

not give a fly and poop what you're

buying or selling or if you make money

or lose money. Obviously, it's nice if

you make money because you're likely to

stay on the app, right? So, this is why

they like to give you education and

don't gamble and all this kind of sort

of advice.

That said, Vlad's event today was all

about, hey, we're gonna in the future

create a Robin Hood chain so we can

create essentially a realworld custody

train and we're going to chain and we're

going to tokenize a bunch of different

assets whether it's bonds or private

equity or real estate in the very long

term. That'll be the last thing that

gets innovated or private company stock.

So basically the presentation we got

today was instead of a fl a flaming pile

of poop because you don't really want to

buy a flaming pile of poop, right? In

this like box, what we're actually going

to do is we're going to say, "Hey,

you're going to buy shares of Open AI

stock." Now, where does Robin Hood get

OpenAI stock? Well, either Robin Hood or

a market maker, somebody goes and buys

$200 million of OpenAI stock from some

overpaid employee inside of the company

who wants to sell. So, they now hold the

private shares and then whoever bought

them can go sell them at a premium.

Like, I got OpenAI stock. I got the hot

commodity cuz some employee sold it to

me and then they turn around and and

resell it. You could do that today with

like an equity zen or a start engine.

The problem is it's a pain in the butt

because often you have to be a qualified

purchaser. You have to be an accredited

investor.

Robin Hood might be able to streamline

some of this by filing, you know,

regulation A offerings and and letting

people invest in these private

opportunities through their app. Now,

somebody's going to make money on this.

Either Robin Hood's going to collect

fees or sell it at a higher valuation or

they're going to be wide spreads between

what these market makers are charging.

But the whole point is Robin Hood is

trying to increase the amount of stuff

that they have in this this box

basically this slice, right? So Robin

Hood started, if you think about it,

they started with US stocks, okay? Then

they went into crypto because the

spreads were huge. You can make a lot of

money on crypto. Robin Hood makes as

much money from crypto as they do on

options. This is big, big money right

here. So crypto and options, huge money.

US stocks, they actually make very

little money every time you buy US

stocks because it's very liquid. So,

actually, the more illquid what the pile

of poop is that they want to sell you,

the more money they make. In other

words, the bigger the spreads are. Cuz

if you go swipe up on Apple stock, the

spread might be one penny. you go swipe

up on, you know, some lowflat stock or,

you know, a memecoin or a private equity

option or whatever, the spread's going

to be massive. The bigger the spread,

the more the rebate, baby. That's how

Robin Hood makes money. So, if they can

now get into private equity or tokenized

assets, their spreads might actually be

even bigger. It's more money. And this

is what they're announcing today is that

in Europe, they're going to allow you to

buy US stocks by tokenizing it. So

basically, every time somebody says,

"Hey, I want $200 of Apple, Robin Hood

will go buy the $200 of Apple, and

they'll give you a token which

represents that $200 of Apple that they

hold." Now, obviously, this creates some

issues. First of all, are the regulators

okay with this? because you're bypassing

European stock registration regulation.

Presumably, Robin Hood has figured that

out and they're not trying to scam

European regulators because they invited

regulators to their event. It also

creates some issues like, well, what if

Robin Hood loses my Apple stock? Well,

they probably custody it over at the

DTCC. So, it's probably not a Robin Hood

issue. It's probably at some other

higher level entity, right?

Or some bank like a JP Morgan or

whatever, right? The point is that's

probably less of the issue. The issue is

that Robin Hood or the whole point of

the announcement is trying to create

ways for people around the world,

specifically now in Europe where they're

expanding their platform to to invest in

US stocks without those US stocks having

to list in Europe. You know, I gave this

example of House Hack. If I wanted to

sell House Hack to where you could just

swipe up on Robin Hood, I could IPO

House hack. So, it's my real estate

startup house hack.com. You've heard

about it before. We pay a 5% yield uh

through conversion uh and then you get

all the upside in the stock. It's open

to nonacredit investors. Now, one of the

reasons I know so much about sort of the

broker dealer world is because I've gone

through broker dealer licensing series

27, 24, 14, uh the financial advisory

65, the 63, the SA, like I've done all

these, the seven.

There's a lot of legal and compliance

work that's involved. Where tokenization

is really great is you basically have t

plus zero. That means there's no

settlement delay, which means you don't

have fail to deliver or fail to receives

that you have to deal with because

there's no lag in when money shows up

and tokens transact. So you actually

have a faster system

and it's a system that potentially

enables you to say, "Hey, you want to

sell that house hack stock in America?

Cool. You have to IPO in the New York

Stock or on the New York Stock Exchange

or NASDAQ. Cool. That's very expensive

and it takes a lot of effort work to do,

but it's okay. You could do that. You

got your PCAOB audits, your securities

compliance and everything, which we

already have almost all of that.

If I now want to sell these shares in

Germany, I might have to and I want

people to be able to swipe up in the

Robin Hood version of of Germany. You

know, you can now I think you can now

download the Robin Hood app in Germany

actually. I would have to IPO

potentially in the Frankfurt Stock

Exchange.

Well, now I have to be subject to German

uh regulation, German audits, German

securities filings, German attorneys.

It's a lot of work. Or Vlad can just go

in and go, "You know what? Just buy a

token of Kevin's house hack and then

Vlad will go buy the actual underlying

house hack shares and he'll hold them or

I'll custody him at a bank or DTCC or

whatever." Uh, and all of a sudden you

have skipped a lot of extra burden for

companies to be able to share sell their

shares. So what does this mean for

people?

Well, it really makes no difference

unless things go poopy dupy. Like if

there's some kind of market panic and

for some reason the tokenization system

breaks, that would be a big risk. Other

than that, the cool thing, the upside of

it is you could now basically hold that

deed, the ownership of your shares, the

token, which is really just a

representation of your ownership, and

you could go send it to your friend

yourself. But then that also opens the

door to questions of like, are you now

selling securities in the United States?

There's like a lot of regulatory big old

question mark over here. The the big

bottom line of this whole event is Robin

Hood introducing tokens enables them

probably to sell more stuff and make

more money per swipe. That's the whole

point. So like everything they announced

is good for the stock, good for the

company, good for their revenues. How

they figure out all the regulation

between all these different countries to

be determined. Are there downsides of

tokens? Yes. But there are also upsides

of tokens. Like again, tokenization

faster. No fail to delivered, no fail to

receive. Uh it's much easier for

compliance. In the future, it's going to

be cheaper. You could do this 24/7.

Tokenization is great. But remember,

when you're tokenizing private equity,

you're really just tokenizing somebody's

ownership that they sold out, maybe an

employee or whatever. You can buy this

stuff now at Equity Zen or Stard Engine

or whatever. And if you see, oh, I have

to be an accredit investor. Well, you

probably have to be an accredited

investor at Robin Hood as well, unless

they do their own regulation, a

nonacredited filing. So, tokenization

sounds great, but you still have to do

all of the legal regulation. It's kind

of like people tell me, they're like,

"Hey, Kevin, why not, you know, tokenize

house hack real estate?" We can do that,

but we would have to do twice as much

work as we do now. Because if I were to

say to you, I want to sell you 10% of

all the houses hack owns via a token. We

would have to go do a nonacredited

offering if we wanted nonacredited

investors. So almost everyone, we'd have

to do a reggae filing. We'd have to get

a legal opinion. We'd have to get an

audit uh for that specific fund. It'd

probably cost us 40 to $60,000 in audits

and attorney fees and everything. Yeah,

GPT probably writes it all, but you

still need those legal professional

opinions. And then we could sell that

10% to uh nonacredit investors. And now

if we sell that to nonacredit investors,

we have to maintain a ledger of those

shares. And if we tokenize it, we double

the work. We do a token and a ledger

because the way US regulation is kind of

behind right now is you have to do both.

You do the token and the ledger. In the

future, hopefully you could just do the

token, but you're still going to have to

go through that securities registration

process. So tokenization

has a lot of great in the background

functions for making things cheaper. You

know, Robin Hood is partnering on USDG,

a stable coin. And I think people are

going to hear stable coin. They're going

to go, "Oh, it's going to be like

circle. It's going to moonlike circle

maybe, but you need to see the partners

that are involved in USDG DG. Uh, unlike

USD, whatever. I I wrote some of these

things down. Unlike circles, USDG

is all of these different partners. So,

you're probably going to see way less

stable coin profit. Uh, and in the

future, I kind of expect stable coin

profit to basically converge to near

zero because everybody's going to have

their own stable coins. Visa and

Mastercard will have stable coins.

Walmart, Amazon all have stable coins,

whatever. But they did mention this.

Now, the whole point of everything that

they announced today is access. They

want European users to be able to buy US

stocks and ETFs. They want you to be

able to access private equity. The

tokenization thing is really just the

representation of your ownership. It's

like the pink slip on your car. When you

have a loan on your car, you don't

actually hold pink slip. Some bank

trustee holds your pink slip. When you

pay off your car, you get the pink slip.

The token is nothing other than the pink

slip. Like you can still drive the car

and not have the pink slip. I know

that's a little complicated to think

about, but think about it kind of like a

deed on a property. A token is really no

different than the deed of your

ownership of the property. It records

your ownership interest. It just does it

faster on blockchain because and it's

public. Everybody could see it, which

obviously reduces costs for the inter

intermediaries in the long term. But

anyway, there were some questions that

came up with this. Some people were

wondering like, well, you know, what is

the potential that this like bubbles up

valuations more? Well, if more people

want to buy Apple stock, yeah,

valuations could actually go even higher

by enabling Europeans to just go buy all

of this. Now, other companies have

already been doing this. They have, you

know, European versions of Tesla stock.

They have uh, you know, Binance has uh,

international stocks that they've

basically already tokenized. So, this is

just specifically to Robin Hood. It's

them getting into this game that has

already been done by others in the past.

Uh theoretically, you could also

self-custody the token, but you wouldn't

self custody the share if you're not in

the United States. So, you're kind of

one step removed from the actual

ownership of the underlying share. Uh

somebody then asked me, you know, why

like, you know, Vlad mentioned this word

burn, which sounds like a dirty,

potentially scammy word.

That's because when you hear of meme

tokens that are like, "Oh yeah, we're

going to burn some of it to lower the

outstanding supply to increase the price

of the meme token or whatever, people

usually associate burning with like it

should be good for the underlying

holders, but there's always a yeah, but

and then like rug pulls come out of it."

So, I don't think people really

resonated with what Vlad was saying with

this burn phrase. So, I think an easy

way to think about the I is this. Let's

say you say, you know what, I want to

buy like we just, you know, let's say

you're like, "Hey, I want to buy

$200,000 of House Hack, but I want Vlad

to buy it for me." Okay, so you give

$200,000 to Vlad. Vlad buys House Hack

stock. Uh, and then Vlad gives you

uh gives you the token to represent that

interest. Uh oh, I guess I never shared

my screen. There you go. So, it's

$200,000. You give it to Vlad. Vlad goes

and buys the underlying stock. Vlad

gives you a token. And you now have that

token ownership of that $200,000 which

you could transfer to your friends or

whatever, subject, obviously the

securities regulation. Now, if you undo

this and you're like, I want my $200,000

back, then what you do is you burn the

token.

Vlad sells that house hack and then Vlad

gives you your $200,000 back

theoretically or whatever the value is

at the time, right? That's what they're

doing. And the whole thing is Vlad

doesn't want to actually hold the

underlying. He just wants to transact.

Remember, why does he want to transact?

He wants to transact because that's how

Robin Hood makes money. So again, it

doesn't matter what's in the basket. It

just matters that they're selling stuff.

The more illquid it is, the more money

Robin Hood will make.

That's why crypto and options make a lot

of money for Robin Hood because they're

very illquid compared to US stocks on NY

or NASDAQ. Private equity is even more

illquid. So presumably would make even

more money for Vlad, which is brilliant.

Like I I love the guy. I think he's

brilliant. But this is hopefully where

where you understand what they're doing

is just opening access to people to get

what they want. Exposure to US ETFs or

stocks or in the future real world

assets or whatever. And yeah, it

potentially creates some more buying

pressure and potential overvaluation

concerns, but that's different, right?

Technically, if you have more people

holding something, there should be more

stability and less volatility.

Now, I know some people are like, like I

see some comments here. They're like,

"Oh, like how's this different from FTX

or Sam Bankman Freed or whatever." So,

the thing about FTX is that FTX was not

a broker dealer, right? So, and I'm not

trying to like shill for the like the

whole like Robin Hood here, even though

I love Robin Hood and I probably would

shill for Vlad and Robin Hood, but uh

the point is that's not the point of

this video. Uh, if anything, I'd love to

show you House Hack. Get your exposure

to real estate. Go to househack.com.

Read the investor paperwork and the

risks related to investing in private

equity. Anyway, the Robin Hood is a

licensed broker dealer, which means they

have really strict custody compliance in

terms of who holds the underlying

assets. Uh, FTX was not a broker dealer.

Uh and then they they were able to

essentially self-custody

which then removed that that sort of

level of security that you get by having

like the DTCC custody your assets. These

are a lot of really big entities and

names and words and stuff. But the point

is, you know, here's a US regulated

company. This was not a US regulated

company. Worth understanding the

difference. Now, a lot of people really

liked FTX because it gave them access to

like 40x leverage on crypto or gave them

a tool to buy crypto back then. But most

creators, myself included, would always

say, "Don't keep your money on an

exchange." So, like, if you're going to

use an exchange, you buy there and then

you take your your you self custody, get

it off, put it on a hard cold, you know,

hard wallet, cold storage, whatever you

want to do, and uh and get it out of

these exchanges because you don't want

to rely on that broker dealer. That's

less of an issue with something like

Robin Hood just because they are so US

regulated. But yeah, broker dealers do

fail in the United States. And that's

where in the United States we have

something called Cypic.

Uh and it's kind of a way it's sort of

like FDIC. It's a little different.

There are differences. You should look

up the differences between Cypic and

FDIC. But it's basically a way to help

you get some of your securities back

should a broker dealer fail. But mind

you, they're custodied somewhere else.

So even if a broker dealer fails,

technically the underlying assets aren't

at the broker dealer anyway. They're

somewhere else. So CIPIC really only

applies when there's a loss above and

beyond,

you know, what was custodied elsewhere

and what was able to be redeemed.

So I understand all this stuff is

really, really complicated. Uh, and so

I'm just going to like bottom line this

as simply as possible. All these

announcements from Robin Hood are

exactly what Robin Hood should be doing.

It's exactly what Vlad should be doing.

And there's a reason the entire finance

space is rocketing right now because

well, first of all, Circle gets

everybody a big boner right now. Uh

because it's the stock has just done so

well uh to the dismay of like Visa and

Mastercard. The people at Visa and

Mastercard are fuming right now. Uh me

meanwhile Visa already does you know

stable coin backend work internally and

so do many other companies like JP

Morgan has had a stable coin that

they've had in the works for years. Uh

Circle is just the most public of that

if you will. But these these financial

companies are doing really well today

and it doesn't really matter what it is.

It could be a company like Dave that

literally hands away money to get people

to sign up for their account which helps

them continue to show user growth which

helps their stock skyrocket. It's kind

of like a brilliant bubble that

guaranteed will pop one day, but for now

it's just going to the moon. So you

maybe you can ride that wave for now.

But look at the fun the financials. It's

insane. Uh really a topic for a

different video, frankly. Uh but the

financial sector is doing pretty

decently. I mean Hood's up 10%, Sofi's

up 9%. Carvana and a firm up a little

bit, but finances are doing really well

today to the downside of like the semis

sector. As you can see, just like what

we talked about in our alpha report,

we're unlikely to hold these these mid

140s lines. And sure enough, we're now

bouncing off the low 140s. See, the

lines are working quite well right here.

Uh just like what I said on Circle, I

said that people would be taking profit

on Circle and don't get caught up in in

a run on Circle today. people are

probably going to take their profits

again. Also, in our alpha report this

morning before the market opened, I

suggested this would be a risky spot.

Uh, so check that out if you haven't yet

over at me.com. But anyway, broadly, so

like bottom line on hood, more stuff to

sell you,

more tendies for Vlad,

and maybe one day I can have a nice suit

like what Vlad had for his presentation

in the French Riviera.

Uh, so yeah.

Oh, okay. I mean, there's a question

here. Is Hood going to have a cash sweep

problem if Hood get if Trump gets his

way with cutting rates to 1%. It doesn't

matter what interest rates are. They

will just pay you what they are, right?

So, example, if a stable coin, you could

use a stable coin, you could use a bank,

it replace it all for the same, but this

question has come up before. If a stable

coin is paying you 4 and a.5% right now

because they're paying you at all those

treasury yields. If treasury yields go

down to 1%, guess what they're going to

pay you? 1% or maybe a little bit less.

So there's a spread in there for them to

make profit. If yields go negative, they

might not buy treasuries at all. They

might just hold cash and then they

basically yield zero. Or they hold

treasuries that yield negative and then

you yield negative in a negative rate

regime.

It it all balances out is the way to

think about it. Uh,

but I don't I don't see any particular

risk there. Why not advertise these

things that you told us here? I feel

like nobody else knows about this. We'll

we'll try a little advertising and see

how it goes. Congratulations, man. You

have done so much. People love you.

People look up to you. Kevin P right

there, financial analyst and YouTuber.

Meet Kevin. Always great to get your

take.