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- Robinhood plans a full shift toward permissionless tokenized stocks for DeFi use.
- The company uses Arbitrum Stylus to solve compatibility limits in financial systems.
- The final phase will let users move stock tokens into external wallets and dApps.
Fintech leader Robinhood has revealed a three-phase plan that aims to open tokenized stocks to all decentralized finance users. The company is building this plan on Arbitrum Stylus to secure smooth compatibility. The effort marks a major step toward linking traditional securities with decentralized applications.
This move started at Robinhood, which is already offering opportunities to purchase tokenized shares of large stocks for its users in Europe. The services also cover hundreds of listed firms and will include private equity at a later stage.
Robinhood is also poised to integrate traditional assets into open finance infrastructure. This roadmap is executed step by step to realize full permissionlessness to freely manage one’s assets without reliance on any single system or platform.
Robinhood Phases in Tokenized Stocks
Currently, phase one is underway. Users inside the European Union are able to buy tokenized shares of stock through the Robinhood application. At this point, these tokens are not redeemable or transferable out of the application. The assets are locked inside Robinhood’s own network and cannot be accessed by any external protocols.
“Robinhood sees this stage as a controlled launch point to validate market interest and performance,” continues Dr Engert. “In stage two, researchers will examine the basic systems driving this offering,” and for this purpose, “Robinhood is leveraging Bitstamp, whose assets it recently acquired this year to facilitate continuous trading of stock tokens,” adds Dr Engert.
This removes any constraints imposed by standard market timings. The new market is compatible with crypto markets because it is operational 24/7 for trading. The company is planning to create a solid foundation for further linking these tokens to third-party platforms.
The final stage is where everything is expected to see its most drastic changes or improvements. Users will enjoy full control over their tokenized shares of stock. They will have the opportunity to transfer their shares to third-party wallets for use in lending apps or dApps.
This shift will cause stock tokens to become agile instruments in the DeFi sector and will also redefine how retail investors engage with stock markets because these instruments will no longer remain within brokerage networks.
Stylus Lets Developers Use Rust and C++ on Ethereum
The requirement forpermissionless access faces one major challenge. This is because Robinhood’s engines are designed using languages such as C++ or Rust code. This code is not automatically supported on Ethereum because Ethereum’s smart contract code is written in solidity. This is because rewriting engines is full of risks and takes place under extensive delays.
Arbitrum Stylus is such a project. It makes it possible for developers to use Rust, C++, and Python to program smart contracts while being EVM-compatible. Additionally, Stylus brings another virtual machine to the Arbitrum ecosystem to facilitate faster execution with low fees.
The developers can use Stylus to improve their dApps written in Solidity code or create new dApps from scratch. This move is expected to bring efficiency to DeFi development through optimization, as estimated by Arbitrum.
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