From Retail Investor Paradise to Financial Disruptor: The Business Landscape and Future Moves of Robinhood

On June 30, 2025, the stock price of a certain trading platform surged over 12% during the day, setting a new all-time high. The market frenzy was fueled by a series of significant announcements made in Cannes: the launch of stock tokenization products, the establishment of a Layer 2 blockchain based on Arbitrum, and the provision of perpetual contracts for EU users. This signifies a fundamental shift in the market's perception of it—no longer just a "retail investor trading app" aimed at young people, but rather an attempt to become a potential "financial infrastructure disruptor."

This article will analyze the evolution of its business model and the logic of its core strategy from three dimensions of "yesterday, today, and tomorrow," and will deduce its future impact on the industry market.

1. Yesterday: The barbaric growth and transformation pains from "zero commission" to "diversification"

1. Entrepreneurial Intent and User Positioning

The story of the platform began with two founders who had backgrounds in physics and mathematics from Stanford University. Their experience in developing low-latency trading systems for hedge funds made them realize that technology designed for institutions could also serve retail investors. Their original intention is "financial democratization", aiming to provide ordinary people with the same investment opportunities as institutions.

They seized the wave of mobile internet and launched an App designed specifically for mobile devices in 2014. Its two disruptive innovations are:

• Zero-commission trading: Breaks the charging model of traditional brokers, greatly reducing the investment threshold.
• Ultimate user experience: A simple and even "addictive" interface design gamifies complex financial transactions, attracting a large number of young people without investment experience.

2. Establishment and Controversy of Core Business Model

"Zero commission" is not a free lunch; behind it is a carefully constructed diversified income model, among which the most representative and controversial is PFOF (Payment for Order Flow).

Based on PFOF, the platform continuously expands its business landscape and has built three major revenue pillars:

• Trading business: rapidly expanded from initial stock trading to options and cryptocurrencies.
• Interest income: By introducing margin loans and cash management services, we convert users' idle funds and leverage demand into stable interest income.
• Subscription services: Launch value-added services, providing instant deposits, pre-market and after-market trading functions.

3. Growing Pains: Crisis and Reflection

The brutal growth is inevitably accompanied by growing pains. The platform's development has been filled with various crisis events:

• Technical and Risk Control Crisis: In March 2020, on a historic surge day for the US stock market, the platform experienced a full-day outage, leading to a collective lawsuit from users.
• GME Incident and Trust Crisis: The GameStop incident in early 2021 was a turning point for its reputation. The platform suddenly restricted users from buying popular stocks such as GME, and was accused of "pulling the plug" and betraying retail investors.
• Ongoing regulatory pressure: From FINRA's fines over PFOF issues to investigations into its cryptocurrency business, regulation remains the Damocles sword hanging over us.

These crises collectively exposed the platform's vulnerabilities: instability of the technical platform, flaws in risk control mechanisms, and potential conflicts between the business model and user interests.

2. Today: All in Crypto - Strategic Ambitions and Business Logic

1. Core of Strategic Shift: Why RWA and Tokenization of Stocks?

Betting on RWA and crypto technology for the future is not a whim, but based on profound financial drives and strategic considerations.

Financial Driven: According to financial report data, the cryptocurrency business has become the most profitable business on the platform. In the first quarter of 2025, cryptocurrency trading contributed $252 million in revenue, accounting for 43% of total trading revenue, surpassing options for the first time as the largest source of trading revenue.

Narrative Upgrade: This move helps the platform upgrade from a controversial "retail investor brokerage" to a "bridge connecting traditional finance and the on-chain world."

Core objective: to disrupt traditional financial infrastructure. They believe that leveraging blockchain technology can achieve:

• 24/7 round-the-clock trading
• Near-instant settlement
• Ownership can be infinitely divided
• Enhance liquidity
• Automated Compliance

2. The "Trinity" strategic combination: How to achieve the goal?

To achieve this grand goal, the platform has launched a set of "trinity" strategic combinations:

• Stock Tokenization: Launching US stock tokens in the EU market to bridge the gap between traditional assets and the on-chain world.
• Self-built L2 public chain: A proprietary Layer 2 public chain optimized for RWA built on the Arbitrum Orbit technology stack.
• Platformization: Build a "crypto-driven all-in-one investment platform" that covers the entire lifecycle of users from deposit, trading to asset appreciation.

3. Comparative Analysis: vs. a certain cryptocurrency trading platform & traditional brokers

vs. a certain cryptocurrency trading platform:

• Path difference: The former is a "on-chain exchange," with the core focus on serving native crypto assets. In contrast, this platform is a "on-chain brokerage," aiming to "transform the old world through blockchain."
• Advantage Comparison: The latter's advantages lie in its deep roots in the cryptocurrency industry, compliance depth, and institutional client base. The platform's advantages are its large retail investor base, exceptional product experience, and a more aggressive and focused RWA strategy.

vs. traditional brokerages:

• Mode differences: Traditional brokerages primarily serve high-net-worth and institutional clients, relying more on interest and advisory services for income. This platform, on the other hand, caters to younger, more active retail investors, with income being more dependent on trading commissions.
• Data comparison: This platform has surpassed two-thirds of a certain traditional brokerage in terms of account numbers, but the average assets per account are only about 2% of the latter. This is both its shortcoming and its growth potential for the future.

3. Tomorrow: The "First Entrance" to Reshaping the Financial Order? Opportunities and Risks Coexist

1. Potential Impact on Financial Market Structure

• Squeeze the liquidity of altcoins: When investors can trade blue-chip tokens backed by real value on a compliant and convenient platform, the demand for high-risk, fundamentally weak altcoins and Meme coins may be significantly diverted.
• Reshaping stock trading rules: 24/7 trading will completely break the pre-market and after-hours restrictions of traditional exchanges, having a profound impact on global liquidity allocation, price discovery mechanisms, and even market maker strategies.
• Accelerating the entry of traditional financial giants: The platform's aggressive layout will become a "catalyst," stirring up the entire traditional financial industry.

2. Self-opportunities and valuation reconstruction

If the strategy succeeds, the platform will usher in huge development opportunities:

• Become the "first entry point" for RWA: has the potential to become the core hub connecting trillions of dollars of real-world assets with the crypto ecosystem.
• Valuation anchor shift: no longer a purely cyclical brokerage influenced by trading volume and interest rates, but a composite company with attributes of SaaS, fintech, and infrastructure.

3. Persistent Risks and Challenges

The grand blueprint of the platform is not smooth sailing, and it still faces three core challenges:

• Regulatory uncertainty: This is the biggest bottleneck in achieving its strategy.
• Execution and competitive risks: Building a self-developed L2 public chain, integrating acquisitions, and implementing global expansion plans, each step tests strong project management and execution capabilities.
• Inherent vulnerability of the business model: The revenue structure will still rely heavily on highly volatile trading operations in the short term, especially in cryptocurrencies.

Summary: A new and old financial derivatives blueprint in progress

The platform is trying to move from the margins of the financial system to the center through a gamble centered on RWA and cryptocurrency technology, becoming a "system designer" and "infrastructure provider" at the intersection of new and old financial orders.

It aims at the underlying reconstruction of the entire asset issuance, trading, and settlement system—transforming the closed, expensive, and inefficient rules of traditional finance into a new financial logic that is open, programmable, and composable.

The success or failure of this transformation will not only determine the fate of the platform itself, but will also significantly influence the evolution path of the global financial markets over the next decade. It is no longer just a stock code, but a "derivative blueprint" that observes the future financial landscape, filled with infinite possibilities. Volatility will persist, and the space for institutional arbitrage has just begun to open.