Robinhood CEO Vlad Tenev Talks Trump Accounts | Bloomberg Talks

Yeah, thank you for having me, Katie. The uptake has been tremendous. The aspiration from the beginning was to make this the best product that the government has ever been associated with. We had six million kids sign up pre-launch and express interest. Millions of accounts have already been invested. The app has basically been living at or near the top of the app store chart, so it's continuing to accelerate. More and more people are downloading it and setting up accounts for their families. This weekend, the first investments started rolling in and the money started flowing in. Every newborn born after January 1st, 2025 gets an initial $1,000 for free seeded from the US Treasury. So this is a no-brainer for new parents, but also amazing for anyone under the age of 18. There are 70 million individuals that we believe this could be the best mechanism for them to get ownership from a young age in the US equity markets, which as you guys know have been the greatest engine of wealth creation in human history. So we're proud to serve as initial broker and trustee in partnership with BNY as the financial agent powering this great transformative program. Last week we heard from the Treasury announcing the funds that will be involved. A State Street ETF, the ticker SPYM, is going to be the default fund. In announcing the fund lineup, Treasury said in a statement that in the coming months Treasury expects to make available functionality that will allow parents or guardians to choose how to allocate funds across the additional investment options. But until that functionality is available, all of those contributions will remain invested in the default fund, which again is SPYM. I was wondering if you could shed light on what functionality means in this context, what the wiring and the backend of setting this all up has looked like. The balance that we have to reach is between enabling personal choice and individual choice and balancing that with the need to make sure that these children benefit from the power of compound interest, which Albert Einstein described as the eighth wonder of the world. Compound interest is incredibly powerful. If you take that initial $1,000 and add $100 a month to the account, assuming a fairly conservative 7% annual rate of return, that turns into millions of dollars by retirement age. So it makes a huge difference the earlier you start. Starting at age zero is much better than starting even at age 18 or most people in their 30s. So we want to make sure that the children benefit from the compounding as early as possible.

Well, Roma, Robin Hood has always been about ownership. We want to make everyone an owner. We believe that a future that's owned by the few is inherently fragile, and so broad ownership is essential to have a stable, prosperous, and free society. Right now, the US sits at about 62% of individuals owning equities. With Trump accounts, we think that can get up to 95%. We spend a lot of time talking about the benefits to the individuals – they could make more money, secure their own financial future. But what's underreported is the societal benefits. If you own something and you're not just a consumer or renter, you care about it. You become a staunch defender. We've seen our free market system come under increasing attack in recent years, and I think the best antidote to that is to make everyone an owner and have everyone have skin in the game in the most powerful and impactful companies that are local to this country.

Yeah, it's really a partnership between us and BNY Mellon, which serves as the financial agent for the accounts. We're doing the brokerage services and the mobile development. We work with National Design Studio on the designs to make sure this product has a consistent look and feel and the craftsmanship that we've all been enjoying from other government websites and properties that Joe Jebia has been refining. And of course, the US Treasury and the administration. We think this is a great example of the private and public sectors working together and leveraging our respective strengths to deliver an amazing product to the American people. I think this might be remembered as one of the best things that we've done in a very long time, and it's just an honor to be associated with it as Robin Hood.

Yeah, certainly the technology to do this exists. We have it live in Europe, both to retail consumers and institutional through our Bitstamp exchange offering. In the US, it's coming. The administration has signaled a willingness to innovate. These perpetual futures products have benefits; they are a very capital efficient way to get leveraged exposure to commodities, crypto, all kinds of different assets without worrying about the complexities of managing expiration or rolling. So I think it's going to happen, and you should expect that we make all of our global products available in the US and in all other jurisdictions where they are permissible.