Democratizing the Asymmetric Trade ft. Vlad Tenev

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Welcome to U Got Options, an exciting series right here on Top Traders Unplugged, hosted by none other than Cem Karsan, one of the sharpest minds when it comes to understanding what’s really driving market moves beneath the surface.

In this series, Cem brings his deep expertise and unique perspective, honed from years of experience on the trading floor to candid conversations with some of the brightest minds in the industry. Together, they unpack the shifting tides and underlying forces that move markets and the opportunities they create.

A quick reminder before we dive in, U Got Options is for informational and educational purposes only. None of the discussions you’re about to hear should be considered investment advice. As always, please do your own research and consult with a professional advisor before making any investment decisions. Now, what makes this series truly special is that it’s recorded right from the heart of the action on the trading floor of the CBOE

That means you might catch a little background buzz. Phones ringing, traders shouting as Cem and his guests unpack real world insights in real time. We wouldn’t have it any other way because this is as authentic as it gets. And with that, it’s time to hear from those who live and breathe this complex corner of the markets. Here is your host, Cem Karsan.

[00:01:27] Cem

Welcome back to another episode of U Got Options from the CBOE floor, brought to you by Kai Media and Top Traders Unplugged. Today we’re at the Robinhood Hood Summit here in Las Vegas and we get to talk to no other than the man himself, Vlad Tenev, the CEO of Robinhood.

He made some incredible announcements today, but we start at the beginning with him talking about copper pots and his experience in Bulgaria, all the way to the macro environment in and democratizing all of the things that your retail trader needs to have to navigate this environment. I hope you enjoy this one.

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[00:02:26] Cem

Welcome back to another episode of U Got Options. Today, Vlad Tenev, here, at the Robin Hood Summit. Looking forward to having a conversation.

[00:02:34] Vlad

Yeah, thanks for having me.

[00:02:36] Cem

I know we have a lot in common, actually. My grandfather came from Bulgaria and…

[00:02:42] Vlad

Oh, that’s amazing.

[00:02:43] Cem

Yeah, I remember hearing about your story about copper pots. I wanted to kind of lead off with A little personal anecdote. Do you mind telling the audience about kind of that experience for you and how it shaped your…

[00:02:55] Vlad

Yeah, so, I moved from Bulgaria to the US in 1992 and I was the third person in my family. So, my dad moved in ‘91. My mom moved a year later, and I came six months after she did.

So, we didn’t have enough money to like send the whole family at once. It was kind of like my dad had to get established, my mom had to make sure, you know, everything was actually in order. And then I came with my aunt who was like a teenage punk rock person.

[00:03:26] Cem

How old were you?

[00:03:27] Vlad

I was five.

[00:03:28] Cem

Five.

[00:03:28] Vlad

And so, 1991, my last year in Bulgaria, the inflation rate was something like 150%. It was quite high compared to what we’re seeing in the US – 5%, thereabouts, inflation, which is making people crazy. But, you know, 150% in 1991. In 1997, which I’d been in America for five years, Bulgaria had the unfortunate distinction of the highest inflation rate in the world at like 2000%. So, my grandparents, who were still in Bulgaria, basically had their pensions evaporate. You know, they were retired and my grandfather was a doctor for a naval ship. And so, he had some friends who were importing and exporting things in the ports. So, he had the idea of investing in copper cookware.

Of course, Bulgaria didn’t have Robinhood back then. So, he had this closet full of copper pots and pans, and that’s how he would store his wealth. And, you know, I thought there would have to be a better way. So, with smartphones and technology now, we can prevent you from needing to do that.

[00:04:46] Cem

That’s amazing. I can totally relate because in Turkey the last couple years, where my family is from, there has been 80% plus inflation recently.
In the last couple years.

[00:04:57] Vlad

And they’re trading a lot of crypto. They’re holding crypto.

[00:04:59] Cem

A ton of crypto. Everybody I know, everybody in Turkey has an app on their phone to trade, exchange at least, FX, so they can hedge the currency. And that’s a day-to-day occurrence. So, I think it’s really interesting.

Some of the things you guys announced today are particularly apropos given some of these macro things that we’re seeing. The introduction of futures in particular, I think, you know, short selling, options, and the ability to hedge and play kind of dimensionality, really, really amazing.

[00:05:31] Vlad

Even social, so you can track trends and learn from your peers. We have a lot of smart people that are trading on Robinhood, and if you could tap into that wisdom of the crowd, I think this very powerful tool.

[00:05:45] Cem

I completely agree. And then we have AI. Which allows us to bring it all together.

[00:05:49] Vlad

And make sense of all the information that’s out there.

[00:05:52] Cem

That’s right, democratize a lot of the trading that institutions have now done through other periods.

If you think about the 1960s and ‘70s, which is the inflationary period that most people are historically aware of here in the US, that was an incredibly difficult period for equity and bondholders. Bondholders is obvious to people. But most people don’t realize that, from 1968 to 1982, the S&P 500 lost 50% of its value in real terms. You know, equities are often not a hedge to inflation because of the multiple contractions that you get.

If you can get a 20% bond, for 10 years, from the US government, which you could in 1982, you’re going to demand a much higher earnings yield from your equities. And what was the best performing asset 1968 – ‘82?

Gold.

Copper did pretty well too. But energy, which was about 5% in’ 68. in 1982 it was 30% of the S&P 500 – a mind blowing stat.

[00:06:57] Vlad

That is wild to think about. I mean, the S&P500, in particular, the turnover in the companies is pretty amazing. I mean, you look now versus 2000. I think in 2000 ExxonMobil was the highest market cap company in the S&P 500.

[00:07:16] Cem

It was, absolutely.

[00:07:17] Vlad

And now it’s what, not even in the top 20.

[00:07:20] Cem

Correct, correct, 2.5% to 3% of the S&P right now is in energy. I mean, that’s a bull case for energy. We don’t need to talk about that.

But there are lots of other stocks that also perform really well in a higher inflationary regime. One of them is exchanges like the CBOE. Another one is brokerage businesses because input costs don’t go up nearly as much as earnings during those periods.

[00:07:42] Vlad

Yeah, that’s true. It’s fortunate that our costs are largely fixed and independent of, you know, tariffs and prices of raw materials, by and large. I mean, you can somewhat compute, you can think of as a commodity in some ways. And we use compute, but you know, not nearly to the extent that other companies do.

[00:08:02] Cem

Agreed, agreed, and so, I want to kind of dive into all those little announcements you had and kind of talk about some of what you’re most excited about as it relates to them. I do think that they all are in a bit of a bull market. I’ll paint this last kind of data picture for people.

There are US$500 trillion, globally, in long assets and that I would include equities, bonds, private equity, private credit, real estate. These are what the majority of people invest in. And in the last three years we’ve seen non-correlated assets. Think crypto, think precious metals, also hedge fund assets as well as structured products, so, options positioning, have all grown from US$4 trillion,US$5 trillion, just three years ago, to US$15 trillion.

So, you have this massive supply and demand imbalance, and people are trying to get more non-correlated at record valuations, given some of the things we’ve talked about – the inflationary pressures and the uncertainty. And so, I think it’s really apropos that you guys have now introduced a lot of these other, again, futures options and short selling.

So. I’d love to kind of start with the commodity piece, futures. Well, the futures trading which also includes other things. What different commodities do you guys love? I know you have 40 different commodities that you guys look at or that allow.

[00:09:29] Vlad

Yeah, I mean all the major ones, gold, copper. We talked a lot about copper. Yeah, I mean, if it’s a liquid, tradable name. I know we offer a lot of CME products. I think we offer some CBOE products as well. Um, yeah, we’d like to add it to the platform. We also have prediction markets. I mean, not quite futures outrights, but very popular among those that want to hedge their macro risk completely. So, I was looking at… We have number of rate cuts between now and the end of the year.

Next rate cut, 81% say it’s going to be 25 basis points. We’re at CPI print. So yeah, we’re trying to make it so that you can make a targeted trade for any position.

[00:10:20] Cem

Yeah, and in a more multipolar world, which we’re starting to see, for a lot of reasons. You know in the ‘60s and ‘70s (which is a great comparison) we see much more volatility in non-equity and bond assets, actually. You would think equity volatility would increase. It actually doesn’t in a meaningful way, in that kind of ‘60s and ‘70s period because they’re nominal assets. What you actually see is FX and interest rate volatility goes through the roof. And that kind of makes sense. But things like precious metal, which would kind of fall in that bucket, maybe crypto, are also things that see more volatility. And those are great things to trade for your traders.

So yeah, really excited for what you’re kind of opening up here for a much wider audience. And, as you guys have always done, as Robinhood implies, kind of democratizing that piece, that has largely been part of an institutional crowd set of trades, to a much broader audience.

[00:11:17] Vlad

Yeah, we launched Futures last year at the first Hood Summit, and we launched a ladder alongside it, but it was all on mobile. And we also launched our desktop web product for more prosumer investors, Robinhood Legend. And this year we’re kind of like expanding both of these and merging them.

So, Futures is coming on legend. We’re expanding the ladder, which started on mobile to Legend as well, and to all sorts of asset classes like equities and crypto.

And so now it’s gone from primarily being a mobile app for first time investors to a comprehensive financial super app on desktop and mobile so that we can meet traders where they are not just with the products but also the interfaces.

[00:12:11] Cem

Yeah, I completely agree. And then I’d be remiss if I didn’t talk about options. That’s my big kind of background and a lot of what we talk about on this show. There are a couple of things that you guys announced today, One, 24 hour, like overnight, trading for index options and several kind of different options, which I think is a huge deal given, again, the multipolar world and the 24-hour nature now of global markets. But also, I thought the coolest thing (and gets somebody like me excited) is really the ability to simulate outcomes with options.

All too often I talk to retail traders, and they understand that kind of the two dimensionality of betting on an upside outcome or a downside outcome, but the time decay and the implied volatility effects. I actually talk a lot about third order Greeks, or second order Greeks like vana and charm. These things are really important.

[00:13:05] Vlad

Or even a spread and you know, having multiple legs and being able to visualize what that looks like to your P&L at expiry or at different times. You know, it can be tricky to do that all in your head, or on pencil and paper.

[00:13:20] Cem

And the options market, like the volume is going through the roof. And that’s happening. I’ve talked about this on other episodes and other places, but really as a function of it being a much more precise and dynamic tool to express positioning. You get to play not in two dimensions, up and down, but really in time and space. You can have any moment on a distribution and bet on that precise outcome. And so, you know, I think of that as a new technology, as like you’re on this kind of tipping point on that. And releasing that simulation allows your retail trader to better absorb that and manage that kind of exposure.

[00:14:02] Vlad

Yeah, it’s really about giving people the tools to actually like save time. So, I was telling you this earlier, we actually go into our options traders homes. They invite us of course, but we go and watch them trade options.

And when we first started doing this, our mind was blown by just how much work they were doing outside of the platform. Like they would have these subscription based to do things like what simulated returns on Legend does today. They were paying, you know, upwards of $100 a month. They were doing just a lot of mental math or math on pencil and paper. They had their spreadsheets and much of the work was happening off platform.

And we thought, you know, why don’t we save them this time and actually automate more and more of that so that the entire trade life cycle happens on our platform. And I think we’ve been working on that. We’ve still got a ways to go, there are more tools to add.

But I think just like going through that process has been a big reason why we’ve been growing our market share in options so much.

[00:15:12] Cem

It’s a huge deal, I think bigger than the most appreciate. I mean, I know other hedge funds that don’t even have this level of sophistication that you have, that are trading stocks and bonds, occasionally options, but they themselves struggle with this. So, I think you’re not only giving the broad militia and the people the weapons and tools they need to compete versus some, and maybe even an advantage, and that’s actually huge.

[00:15:38] Vlad

The goal would be to make it so that if you’re a retail trader, you’re at a disadvantage using any other platform. And you know, you mentioned 24
-hour, 24-hour market on the equity side was kind of a very clear way we delivered that.

You know, stuff happens on weekends, Sunday evening, or after hours. And if you’re on another platform that doesn’t allow you to trade during those times, you’re at a disadvantage not just in pursuing other opportunities, making new trades, but even just risk management, closing your positions, hedging your positions. So, yeah, I mean, you can look at overnight index options as an extension of that.

Now, more and more news happens overnight that affects the macro, but also individual companies. And the goal is to just make it seamless. Like crypto is 24/7, there’s no reason why options and all sorts of traditional assets shouldn’t be as well.

[00:16:38] Cem

I couldn’t agree more. In the ‘60s and ‘70s, again, just to highlight that period because, again, an inflationary period, you had a significant inequality build that happened as a function of that flat tax, essentially, of inflation hitting everybody. And a lot of institutional entities had the ability to hedge or to kind of limit their risk.

Nowadays you have access to, again, options were created in 1971. You know, the CBOE was created then. That’s not a coincidence. The capital efficiency, the dynamism and ability to play dimensionality was why they became so popular during that time. And I think, giving access to the tools and ability to focus on those things is incredible for the average retail investor.

[00:17:26] Vlad

I think a big part, also, is making sure they know how to use these tools. I think AI plays a big role. And one of the areas we’re excited to further develop, Cortex, is in mapping your intent to an options trade.

Also, things like what you guys are doing, educating customers, talking about the different trades you can put on the different strategies. You know, we do a little bit of that but it’s clear, as the products get more sophisticated, the education has to kind of keep pace as well, while still being engaging for people and sort of like meeting them on the platforms that they use.

So, I’m looking forward to having really good options education content on Robinhood Social itself. I think that’ll be really, really cool if we become the best place to learn, and generate ideas, and not just execute the trade.

[00:18:17] Cem

Absolutely, yeah. I definitely want to get to the social part as well. But just to touch on that connection between AI and options, I think that’s so important. You know, we have things, technologies that have come along over hundreds and thousands of years that we take for granted that not everybody understands. You plug your cord into an electrical socket. You don’t think about all that’s happening on the other side.

I think options are a better technology. They’re a way to play in three dimensions instead of two. The problem is some of the complexity, at this juncture, until we bridge that gap for people, has not allowed us to get to that tipping point. But now we have daily options, we have more access, more education.

All of those network effects right now, more volume, has allowed it to kind of again reach that tipping point. And I think AI is the key to unlocking that final move to everybody moving to, eventually, two dimensional trading, to much more kind of probabilistic… You know, looking at different outcomes and saying, which outcome fits what I know and what I believe to be true.

And I think that’s what you guys are doing.

[00:19:24] Vlad

Yeah. I mean, you saw the tools we showed yesterday. It’s just the very beginning. I think AI tools will be side by side, the traditional tools and widgets. You have your chart, your chain, your screener and scanner.

And you’ll see deeper integration, not just in the charting and the scanning, which we’re going live with now, but also in the back testing, in the simulation, and eventually the execution side as well. So, in the same way that like AI has integrated the software engineering tool chain with things like Cursor,

I think, it’ll integrate with trading, and Robinhood Legends, sort of going to be leading that charge because we’re sort of among the few that are working on these tools for retail in a big way and still iterating and innovating.

[00:20:19] Cem

Yeah. I think, AI, in general, particularly here, the benefits of it will tend to accrue in areas where things are more technical and it allow a simplification for an average person to cross…

[00:20:32] Vlad

And when there’s so much data and information to pour over. It’s funny, one of the first use cases of Nvidia GPUs (you probably remember as I do), Nvidia used to be a gaming GPU company.

So, if you wanted to like play Doom 3 or Crysis, at high frames per second, you’d buy an Nvidia GPU. Then they came out with the Nvidia Tesla high performance computing chips and the CUDA toolchain. This was, I want to say 2009. And one of the early customers, when they expanded beyond graphics, was trading firms who were using these things to price options. So, in a way you had gaming and options trading basically laying the foundations behind the AI revolution that we’re in the midst of.

[00:21:23] Cem

Yeah, I honestly wouldn’t have gone there, until you brought it up, but I couldn’t agree more. Trading has been at the forefront of neural networks. And understanding statistical modeling, particularly in the option space. So, it’s a natural connection for now, to come full circle.

And now AI, really, to help take retail and people into that world and expand their possibilities there. So, I really do see this as a huge unlock for options, specifically, on an institutional level, but as well as retail.

But let’s move on from the options a little bit. You also announced short selling, which I actually think is a…

[00:22:04 ] Vlad

A big crowd pleaser for sure. If you see our social posts, the shorting one just went viral, like wildfire.

[00:22:13] Cem

And if you think about why, you’re kind of holding, with two arms, you’re holding one arm behind your back if you’re trading only long. And a big differentiator is that institutions don’t have that. And they have a million ways to kind of play both sides and be much more dynamic.

[00:22:29] Vlad

Yeah.

[00:22:29] Cem

So, you’ve really kind of allowed retail to play with both hands at this point.

[00:22:34] Vlad

Yeah. There’s been a long standing belief, I should say, that retail investors don’t like short selling and that’s not exactly true. Retail investors like short selling just fine. They don’t like being at a disadvantage to the institutions.

And so, I think that that was why this was so well received because I mean, not only is it an interesting product, but it’s one of those things that institutions have had access to for a long time that frankly hasn’t been accessible to retail. And people know when Robinhood integrates it, it’s going to be easy to use, accessible, low cost.

I think it’ll be the best shorting product and we’ll integrate it into all of the interfaces that we’ve rolled out. So, obviously standard order ticket, but also the ladder, the equities ladder where we demonstrate it, also the chart.

So, as we sort of like extend the platform and we add new capabilities, the value just accrues to our users.

[00:23:37] Cem

I couldn’t agree more. And it’s, it’s perfect timing. Not that markets are going to decline tomorrow or whatever, but we are at record valuations. Like, in terms of, you look at 2,000 valuations and, you know, the probabilities of some two-sided trading, not just number going up all the time is more likely.

And again, that could be… You know, again it’ll be nice to have that dynamism and ability to trade both sides, if and when that time comes, which it always inevitably does.

[00:24:05] Vlad

If we go to Robinhood as a business. One of the criticisms we’ve had, historically, is that when we’re in like bull market times, the business is just firing on all cylinders, metrics are good, people trade a lot. But the traders tend to get less active when we get to bear markets.

But, over the past couple of years, we’ve been working to really change that by giving our active traders more tools. So, we’ve made multi leg options really easy to use, reduced the friction. It used to be kind of clunky to get into a multi leg options trade. But now we have the side by side chain, we’ve got simulated returns, those have been going very well. And if you look at equities, short selling wasn’t an option. Of course you could get some of that intent with, you know, inverse ETFs and things of that nature.

But I think shorting will make the business more resilient on the equity side, because it’ll give people a way to execute on a point of view during declining markets.

[00:25:12] Cem

Historically, if you look at, talking about the business a little bit, if you look at things like the CME and the CBOE, they actually can be countercyclical at times. Like their volumes can actually increase into market declines.

And in a much more multipolar world, that’s also secularly potentially a major benefit. So, I do think, whereas asset managers, brokerage firms that are more long only equity focused have significant problems with this. So, you’ve kind of made your business more resilient, candidly.

[00:25:44] Vlad

Yeah, we made our business much more resilient over the past few years for sure. Because, when 2022 hit and it was a difficult time for the markets, you know, we’d gone from a zero interest rate environment to the highest rates in 30 years, the highest inflation in 30 years. If you were a lot of companies in our broader sector, like if you were a mortgage company, they just battened down the hatches and said, we’re going to just go through, we’re going to make it through the winter, and hopefully markets inevitably will improve at some point. And we said, we’re not going to do that. Our approach will be give customers what they need right now.

So, we had the high yield products, Robinhood Gold came out, and we really started investing in options and building out futures for precisely that reason. Because derivatives trading and interest in derivatives actually tends to increase during bear markets.

[00:26:44] Cem

Yeah, it’s interesting, you know, as a firm named Robinhood, you’re essentially aligning your interests with your customers interest. You’re making them more resilient and, by extension, making yourselves more resilient, which I think is actually great too.

[00:26:55] Vlad

I think there’s a misconception that somehow Robinhood does well if our customers do poorly, and we’re misaligned. But if we look at what’s healthy for Robinhood, it’s that our revenue scales with assets under custody. And we’ve got about US$300 billion in total platform assets on the platform, so over a quarter trillion now. And our monetization rates at between 1% to 2% on average.

So, the best thing for Robinhood is for you to fund your account, keep putting money in, do well with your investments, and for your account balance and assets to just increase over time as you continue to be with us.

So, in that sense, long term, we’re highly aligned to our customers doing well. Because the more assets our customers have, the more revenue we generate. So, it couldn’t be further from the truth, that misconception. We really spend a lot of time thinking about how to give customers the tools to do well and grow their assets over time.

[00:28:00] Cem

Absolutely. Before we get to social, which I know you’re excited about, I think I am too, obviously, being somebody who’s involved in social media as well, I want to talk about that great wealth transfer.

We’re seeing about US$50 trillion will change hands from boomers, older people, down to a kind of more millennial Gen Z crowd, which is obviously much more your demographic, historically, because of the new innovation and all the different things. That’s US$50 trillion x 10 in the next 20 years. It’s supposed to be over US$100 trillion.

[00:28:32] Vlad

Over US$100 trillion, yeah. Over US$100 trillion will change hands in the great wealth transfer, the largest movement of assets of all time.

[00:28:41] Cem

Yeah, I think that’s really interesting, particularly given that naturally a lot of your customers are going to be playing with, generally, a lot more money. And, you’re giving them the tools.

I mean, even in my business, I see a lot of people coming to me, who are older, that are brought to me by their younger, you know, their son or their daughter.

[00:29:01] Vlad

Right, we see a lot of that too. Investing in your brokerage used to be passed along by parent to child. So, it’s, it’s a real incentive, particularly for those that have more assets and are a little older.

[00:29:16] Cem

And I think maybe the argument had been, you know, oh, they don’t have the ability to do X or Y. I think expanding the offering, going head to head with the Merrill Lynch’s, the Goldman Sachs, whoever, actually puts you in a position to really make a strong argument for why those bigger chunks of money should also be at Robinhood.

[00:29:37] Vlad

Yeah, a lot of our customers, or I should say non-customers largely, the general public said, well, who’s going to have their life savings in Robinhood? People aren’t going to trust it. It’s not really the brand. And the reality is brand follows product.

So, they were actually right that we weren’t the best place for that. We weren’t the best brand for that. It’s because we didn’t have the products.

For a long time, we didn’t have retirement accounts, we didn’t have joint accounts. You could name a beneficiary. And you know, frankly, we still have work to do. We don’t support fixed income natively. We don’t have bonds. Up until fairly recently, we didn’t have futures or good multi leg support or desktop. But we’re moving through things very quickly. And I think the Robinhood, this year, is very, very different than last year and it’s going to continue to improve.

So, pretty soon I think the best way to, to make sure Robinhood’s the best beneficiary of the great wealth transfer is to get, you know, baby boomers and silent generation on the platform. And we’ve been having more success with that.

I think, actually, there’s no reason why, your parents and grandparents (for those of us that are fortunate to still have them around), there’s no reason why they can’t be on Robinhood.

[00:31:00] Cem

Yeah, completely agree. You guys announced eight different things today. That’s amazing. That’s incredible progress.
I was actually counting through them…

[00:31:08] Vlad

Actually, there are two extra things that were customer feature requests that we promised to build. So yeah, really 10 to 11 new products.

[00:31:15] Cem

It’s pretty amazing.

Let’s talk about social, which is, I think, the last one we didn’t really talk about. I know it’s kind of where you guys started. And I’d love to hear… Whenever you talk about it I hear an extra little tinge of excitement from you about that. Maybe that’s because that’s kind of where it started. Talk to me a little bit about what you guys are doing, and what you’re most excited about there, and dive in there.

[00:31:36] Vlad

So, we asked ourselves, okay, as a financial platform, how can we differentiate ourselves? Because you don’t want to just build another social network. That space is well served by lots and lots of incumbents.

But one thing we have is real transactions of incredible variety. So, we have a huge amount of equities trading going on, on the platform. We’re one of the largest options brokers as well. Futures is a recent asset, but we’re growing very quickly there as well. Prediction markets, we’re one of the largest prediction markets platforms. So, you have all of these assets, all these unique ways to express your point of view about something in the real world, whether it’s macro or a football game.

And what we can do is actually tie your opinion, and just like commentary to an actual trade. And that, I think, creates a very high signal. We can have actual trades, real performance, make sure you have real skin in the game, and then this gives you a signal for who you should pay attention to. And I think we’ll pull on that thread and see where it goes.

[00:32:48] Cem

I actually think, and one of the things that interested me the most is somebody who looks at market structure a lot ,and it’s that you allow, so seamlessly and easily, for people to follow into a trade too. If they really like the opinion or the trade, within a click or two, they can be in the trade and be following it.

[00:33:06] Vlad

Yeah, we want to make that as easy as possible. We still want the end customer to make the decision, and to actually make the trade. But we know that people want to do that. They want to be able to trade directly from the screen where they’re doing their analysis, whether it’s a chart. And we’ve done a lot with trading from the chart, or the latter, where you can interact with the order book, or a social post where you’re seeing some deep fundamental analysis, you want to trade right away.

[00:33:35] Cem

And I know this isn’t your intention, it’s not something that you guys control, but my guess is that we’ve had essentially a bunch of Wall Street bets, or, you know, little pockets where people coordinate and talk and think about (I don’t say coordinate but think about) ideas together and bet together.

And I find it interesting that now you could in theory be widening that out and broadening it together. And you could kind of be creating a broader army. And I do think that’ll have some really interesting effects on market structure. Retail has had a huge impact on markets more broadly. And if you actually allow them to come together in a much more kind of dynamic way, that could really change things in a major way. And be an advantage to some of that crowd, actually..

[00:34:21] Vlad

Yeah, if you look at WallStreetBets and some of the other sub-Reddits that have become very popular, I mean, I think WallStreetBets has something like 20 million subscribers. And you look at the screenshots on that sub-Reddit, I mean, the lion’s share of those screenshots are Robinhood screenshots. So, a lot of our users are using that as a platform to share ideas.

And they’ve been asking for verified trades for a long time because they feel this pain point; there’s this is a screenshot, someone’s telling me they’re doing this trade, it seems a little outlandish. Is there any way Robinhood can attach a certificate to it so you can actually see what’s going on?

And so, one of the things we’re launching, in tandem with Social, is verified posting of these widgets and trades to external platforms. And I think that’s something that…

[00:35:14] Cem

It’s a big deal.

[00:35:15] Vlad

… our community members, even if they’re outside of Robinhood, have been wanting for a long time.

[00:35:20] Cem

I started in business in ‘97, so my first kind of experience was ‘98, ‘99, 2000. It was that retail boom that happened at the end of that bubble,

[00:35:31] Vlad

That’s when I started trading.

[00:35:32] Cem

Oh, did you really?

So, I think that. And certain things rhyme. I mean, not only valuation wise, but we have a tremendous amount of liquidity being pushed into the system right now, and more to come, probably.

So, I do think this year, some of that social stuff, it’s like, again, a perfect time to kind of get people betting on some of those outcomes together, and talking about navigating what is a volatile, potentially wild ride.

[00:36:03] Vlad

Yeah, I mean, you had, in the ‘97 to 2000 period, the dot com internet super cycle. Where you had just a ton of speculation around this new technology. And I think new technologies sometimes lead to bubbles.

Then you had cloud, broadband, mobile, right after that. That was a little bit muted because you had the global financial crisis.

[00:36:35] Cem

Liquidity coming out of the system during that time.

[00:36:36] Vlad

A lot of people are saying, you know, AI, there’s just a huge capital expenditure going into these data centers. A lot of money is flowing into a lot of AI stocks, and people are wondering whether there’s a bubble or not.

And I, I think now we have the tools to actually express that point of view. Who knows? Even if there’s a bubble, they can go on for quite a while.

[00:37:03] Cem

Well, I want to be clear, a lot of people made a ton of money trading in ‘98, ‘99 and even through 2000. And especially, again, by managing shorts, by using options, by trading multidimensionality of interest rates and FX. I think there’s, again, you guys are introducing all the right things at just the right time.

Last thing, just to wrap this up, we talked a lot about what you did today, and what you guys have been working on the last year. What are you most excited for next year? And in five years, what do you see as the next chapter? You guys have introduced so much. You guys are moving so fast.

[00:37:38] Vlad

Yeah, I mean, there are a lot of things that we’ve announced that we now have to roll out fully and keep iterating upon. So, I mean, even social. We’ve announced it. People are excited. Now, we have to deliver, Tokenization, great progress in Europe, but there’s much more to be done.

We really want to have 24/7, round the clock, on chain markets, for all assets, including publics and privates. And we’re at the very beginning of that journey. And then the AI super cycle, I mean, we’re a big participant there. And we’ve made such progress with Robinhood Cortex, including some of the things that we saw yesterday with indicators, custom indicators and scanner generation, that we’re going to go much further.

So, we announced an AI event that we’re going to be hosting in December of this year. So, not quite next year, but it’ll be our fifth product event of the year. And I think there will be some surprises there, some things that our traders aren’t expecting. So, looking forward to that.

[00:38:47] Cem

I think the integration of AI is going to be a huge deal in the next year.

[00:38:50] Vlad

And I don’t think any of our competitors are really trying. So, one of the criticisms of Robinhood is hey, you guys are just launching products that have been around for a while. Your competitors have had them. You’re maybe putting a nice UI, but at least in AI and crypto, I think we’re very much at the frontier and really innovating. So, I’m excited to share more and more of that with our customers.

[00:39:14] Cem

Well, I’m excited about the AI, the options piece most of all, but it all sounds absolutely amazing. Excited to see what happens in the next year. Thank you, Vlad, for joining us. Really appreciate it.

[00:39:23] Vlad

Yeah, thanks for having me.

[00:39:24] Music

Music

[00:39:28] Ending

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