Five years after the GameStop trading frenzy rocked Wall Street, Robinhood CEO Vlad Tenev says the episode was a “wake-up call” that exposed deep flaws in U.S. market plumbing, and convinced him that tokenization may be the clearest path to preventing another such failure.
The result, he wrote, was “massive deposit requirements, trading restrictions, and millions of unhappy customers,” as outdated infrastructure collided with unprecedented retail trading volume.
Tenev said Robinhood’s advocacy helped move U.S. stock settlement from T+2 to T+1, meaning trades now settle in one business day, but noted delays still stretch to T+3 or T+4 around weekends.
"It's reasonable to say that clearing and settlement rules played a big role," Robin Singh, CEO of crypto tax platform Koinly, told Decrypt. "While faster settlement could help reduce these stresses, tokenization doesn't remove all market or regulatory challenges."
But critics say the settlement bottleneck only partially explains what went wrong. While the T+2 clearing cycle amplified liquidity pressure during the surge, it did not affect all brokers equally, raising questions about whether Robinhood’s internal risk controls and capital planning were adequate for the scale of demand it faced.
Musheer Ahmed, founder and managing director of FinStep Asia, told Decrypt that traditional brokerages have previously handled similar surges in demand for stock without incident.
"It is likely that Robinhood had not factored in capital reserves and risk management controls for such a high scale of interest,” he said.
"Irrespective of the scale and terms for collateral, the buck stops with the broker to be able to ensure smooth trading for their clients at all times," Ahmed added. "If a firm is unable to keep up, then it is a lacuna that they need to work on and fix."
Tokenization of stocks can “potentially alleviate the collateral pressures,” Ahmed said, if there are “appropriate smart contracts in place to source the collateral in real-time.”
“Without regulatory clarity, such efforts are moot,” Tenev wrote, saying collaboration with the SEC and CLARITY-driven tokenization standards could avoid another 2021-style shutdown.
