CoinDesk
Robinhood and AMC are clashing over tokens linked to AMC shares. AMC CEO Adam Aron says Robinhood tokenized the stock without the company's consent; Robinhood CEO Vlad Tenev says consent is not required and points to international demand for U.S. equities. In a column, Promethum founder Aaron Kaplan argues that the disputed products track share prices but do not give token buyers ownership of the underlying stock.
Kaplan describes the products as debt securities issued by a Robinhood offshore subsidiary. He contrasts them with tokens that represent shares held in the U.S. clearing system, arguing that the difference is fundamental to investor rights and American capital markets.
Why it matters
A synthetic wrapper can give an investor exposure to a stock's price without conveying the rights of a shareholder, including dividends and voting. Kaplan argues that after shares are bought as collateral, subsequent token-to-token trades take place offshore rather than on the exchanges where the shares trade. His concern is that international demand for U.S. companies may grow without that trading entering the underlying share market.
The distinction is becoming a regulatory question. Kaplan says the SEC's September 17 innovation exemption for blockchain venues excludes synthetic tokens and requires qualifying tokens to carry the same rights and privileges as traditional securities. He also says it provides for company notice and a right to object before a third party tokenizes its shares.
Market impact
The opportunity is broader access to U.S. equities for investors abroad, but the route matters. Kaplan favors a digital-twin model in which a token represents a share custodied at the Depository Trust Company, keeping the asset within the national clearing and settlement system. He points to a tokenization service DTCC plans to launch as a path toward that model.
For investors and issuers, the dividing line is whether a token conveys ownership or merely follows a price. Wider access through real shares could bring new buyers into U.S. equity markets; synthetic trading, Kaplan argues, would leave more of that activity offshore.
Frequently asked questions
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What do buyers of the disputed AMC-linked tokens own?
Kaplan describes the products as debt securities issued by a Robinhood offshore subsidiary. He says they track AMC's share price but do not give buyers ownership of the underlying shares.
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Why does AMC object to Robinhood's tokenization?
AMC CEO Adam Aron says Robinhood tokenized the company's stock without its consent. Robinhood CEO Vlad Tenev says consent is not required.
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How does synthetic token trading differ from trading the underlying shares?
Kaplan argues that once an issuer buys shares as collateral, subsequent trades between token holders occur offshore rather than on the exchanges where the underlying stock trades.
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What rights does Kaplan say qualifying tokenized shares must carry?
Kaplan says the SEC's innovation exemption requires qualifying tokens to provide the same rights and privileges as traditional securities, including dividends and voting.
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What is the digital-twin alternative Kaplan favors?
It is a token representing a share custodied at the Depository Trust Company. In Kaplan's proposed model, the investor buys the share while it remains within the U.S. clearing and settlement system.
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