Robinhood officially launched its public, Ethereum-based Layer 2 blockchain on 1 July 2026. The new network, open to external developers, aims to provide low-cost transactions for its 23 million funded customers. The launch marks the broker’s deepest foray into crypto infrastructure, moving beyond simple trading into network operations. The platform’s native token, Robinhood Coin (RHC), will serve as the network’s gas token for transaction fees.
Context — why this matters now
Robinhood’s pivot to operating a core blockchain protocol follows a series of escalating crypto product releases. The broker enabled self-custody wallet functionality for its users in late 2025. It then integrated direct staking rewards for Ethereum and Solana earlier this year. These steps built the foundational user experience required for a proprietary network.
The expansion occurs as traditional finance accelerates its adoption of blockchain technology. BlackRock launched its USD Institutional Digital Liquidity Fund on a permissioned blockchain in May 2026. JPMorgan continues to scale its Onyx network for intraday repo transactions. Robinhood’s move targets the retail segment, a market largely untapped by institutional blockchain initiatives.
Regulatory clarity around digital asset classification in the US, solidified by the FIT21 Act of 2025, provided the final catalyst. The law created distinct federal frameworks for digital commodities and restricted securities. This allowed broker-dealers to engage with non-security crypto assets with reduced legal uncertainty, enabling infrastructure plays like Robinhood’s blockchain.
Data — what the numbers show
Robinhood’s Crypto division reported $126 million in transaction-based revenues for Q1 2026. This figure represents a 35% year-over-year increase from the $93 million reported in Q1 2025. The segment now contributes to 18% of the company’s total transaction-based revenue, up from 12% a year prior.
The new blockchain launches with a transaction throughput target of 100 transactions per second (TPS). This compares to Ethereum’s base layer capacity of approximately 30 TPS. Competing Layer 2 networks like Arbitrum and Optimism currently process between 4,000 and 7,000 TPS during peak loads.
Robinhood’s monthly active users for crypto products reached 8.9 million as of its last earnings report. The broker holds approximately $16.5 billion in crypto assets under custody for its users. The company’s stock (HOOD) closed at $24.50 on the day of the announcement, up 4.3% on the news.
| Metric | Robinhood Crypto Q1 2025 | Robinhood Crypto Q1 2026 | Change |
|---|
| Transaction Revenue | $93M | $126M | +35% |
| % of Total Rev | 12% | 18% | +6pp |
Analysis — what it means for markets / sectors / tickers
The launch directly positions Robinhood as a competitor to existing Layer 2 networks and crypto exchanges. Native tokens for competing L2s, such as Arbitrum’s ARB and Optimism’s OP, traded lower on the announcement. HOOD is the primary equity beneficiary, as the blockchain creates a new revenue stream from transaction fee capture and potential future airdrops.
Traditional online brokers like Charles Schwab (SCHW) and Interactive Brokers (IBKR) face increased pressure to develop similar integrated crypto offerings. Their current models, which often rely on third-party partnerships for crypto access, appear less competitive. Payment processors like PayPal (PYPL) and Block (SQ), which also operate crypto ecosystems, may accelerate their own infrastructure plans.
The primary risk involves execution and adoption. Robinhood must attract external developers to build applications on its new chain to create utility beyond simple token transfers. Failure to build a vibrant ecosystem would relegate the blockchain to a closed network, limiting its economic impact and potential fee revenue.
Initial trading flows indicate crypto-native traders are shorting HOOD as a proxy bet on execution risk. Long interest is concentrated among traditional equity investors betting on market share gains in the expanding crypto retail brokerage sector.
Outlook — what to watch next
Developer adoption metrics over the next 90 days are the critical catalyst. The number of independent projects building on the Robinhood Chain and the total value locked (TVL) on the network will measure its early success. The first major external protocol launch is anticipated by the end of Q3 2026.
HOOD’s equity price faces a technical test at the $26.00 level, a resistance point it has not breached since January 2026. Sustained trading above this level would signal strong market conviction in the blockchain strategy. Key support resides at its 50-day moving average, currently at $22.80.
The company’s Q2 2026 earnings release on 24 July will provide the first concrete data on user engagement with the new blockchain. Management commentary on the network’s operational costs and initial monetization will be scrutinized. Any guidance revision based on blockchain prospects would significantly move the stock.
Frequently Asked Questions
What is a Layer 2 blockchain?
A Layer 2 blockchain is a separate protocol built on top of a base layer blockchain like Ethereum. It processes transactions off-chain before settling finality on the mainnet. This structure drastically reduces transaction fees and increases speed while maintaining the security guarantees of the underlying base layer.
How does Robinhood’s blockchain make money?
The Robinhood Chain generates revenue through transaction fees paid in its native RHC token. The company likely retains a portion of these fees, similar to how Ethereum validators earn from gas. Future revenue could come from monetizing decentralized applications built on the network and increased trading volume on its core exchange from ecosystem activity.
Can other companies build on the Robinhood blockchain?
Yes, the Robinhood Chain is a public and permissionless network open to all developers. This open access is crucial for its strategy. The value of any blockchain network is a direct function of the number and utility of the applications built on top of it, a concept known as network effects.
Bottom Line
Robinhood is betting its future on becoming a crypto-native financial platform, not just a broker.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
