Coinbase and Robinhood Are Converging, but Who Wins the Onchain Fintech War? - Ep. 864

Unknown Source July 08, 2025 86 min

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100 Companies

117 Key Quotes

3 Topics

1 Insights

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Podcast Summary: Coinbase and Robinhood Are Converging, but Who Wins the Onchain Fintech War? - Ep. 864

This 85-minute episode of Unchained, hosted by Laura Shin, features Dio Kassaris (Founder of Clura Protocol) and Ryan Yee (formerly of Coinbase Ventures) discussing the intensifying competition between incumbent FinTech giants, specifically Coinbase and Robinhood, as they both aggressively move into on-chain infrastructure and tokenization. The central theme is how these established players are leveraging blockchain technology to expand their core businesses and capture new market share, particularly in the realm of tokenized traditional assets.

1. Focus Area

The discussion centers on the convergence of traditional FinTech (brokerage/custody) and decentralized finance (DeFi)/Web3 infrastructure. Key topics include the strategic implications of Robinhood Chain versus Coinbase’s Base L2, the tokenization of equities, and the differing motivations behind each company’s on-chain strategy.

2. Key Technical Insights

• Robinhood Chain Strategy: Robinhood appears to be building a more centralized or “fed chain” (in quotes) focused on coordination and integrating KYC systems, potentially to facilitate the issuance of tokenized stocks and tap capital for leverage requirements.
• Base vs. Robinhood Chain Philosophy: Base operates as a decentralized sequencer (using the OP Stack) that theoretically avoids mandatory KYC per transaction, positioning itself as a true public blockchain for developers. Robinhood’s approach seems geared toward controlled infrastructure for regulated products.
• EVM Preference Rationale: Both Coinbase (Base) and Robinhood (rumored to have considered Solana but opted for an EVM L2 solution, likely Arbitrum) gravitating toward EVM-compatible L2s suggests a preference for a more controlled, familiar, and potentially less complex regulatory sandbox compared to ecosystems like Solana, especially given the MEV structure differences.

3. Market/Investment Angle

• Convergence of Offerings: Coinbase (crypto-first, full-stack) and Robinhood (equities-first, adding crypto) are rapidly overlapping in product offerings (staking, trading pairs, tokenization).
• Robinhood’s Growth Vector: Robinhood’s tokenized stock initiative appears strategically aimed at international expansion (starting in Europe) and growing its core brokerage business by tapping into the crypto user base that traditional stock exchanges cannot easily reach.
• Competitive Metrics: While Coinbase still significantly outpaces Robinhood in crypto-related revenue, Robinhood’s share of volume in crypto trading is reportedly increasing, signaling successful encroachment on Coinbase’s retail crypto dominance.

4. Notable Companies/People

• Coinbase: Highlighted for the success of Base (top Ethereum L2 by TVL/DAA) and its full-stack crypto approach serving retail, institutions, and developers.
• Robinhood: Noted for its recent launch of Robinhood Chain and its acquisition of Bitstamp to bolster European liquidity.
• Stripe & Revolut: Mentioned as other large FinTech incumbents actively exploring or acquiring on-chain capabilities (Stripe acquiring Bridge and Privilege).
• BlackRock: Mentioned in the context of institutional adoption via Bitcoin ETFs, signaling the broader market shift bringing incumbents into the space.

5. Regulatory/Policy Discussion

• The discussion highlights that Robinhood’s initial rollout of tokenized stocks via Robinhood Chain is Europe-only due to current US regulatory climate. This suggests tokenization is being used as a regulatory workaround to enter new geographies faster than traditional Web2 rails allow.
• The difference in MEV structure between EVM chains (where Coinbase internalizes MEV) and Solana is noted as a factor that makes EVM L2s a “more controlled sandbox” suitable for highly regulated entities.

6. Future Implications

The convergence suggests that the next phase of crypto adoption will be driven by incumbents using on-chain rails to offer novel financial services:

1. New Services: Enabling complex activities like collateralizing tokenized stocks for USDC loans or borrowing crypto against tokenized equities.
2. Asset Activation: Making previously idle assets (like held crypto) more active through on-chain lending and borrowing protocols.
3. User Acquisition: Both firms see on-chain infrastructure as the key to accessing user bases they previously could not reach (DeFi users for Coinbase; international/crypto-native users for Robinhood).

7. Target Audience

This episode is most valuable for Crypto Investors, FinTech Strategists, Blockchain Developers, and Venture Capitalists tracking the intersection of TradFi and Web3 infrastructure.

🏢 Companies Mentioned

Zora ✅ nft_gaming_project

Mastercard ✅ institution

Zappo acquisition ✅ institution

Bitcoin ETFs ✅ institution

Citadel ✅ institution

Shopify ✅ institution

Peter Thiel ✅ investment

Derivative ✅ institution

Jito Labs ✅ infrastructure

Revolut ✅ institution

Privilege ✅ institution

Bridge ✅ institution

Stripe ✅ institution

Tone ✅ layer 1

Stride ✅ institution

💬 Key Insights

"What changed my mind about that was actually PumpFun. PumpFun is in the business of making money on small-cap tokens, and we know they have a nine-figure run rate."

Impact Score: 10

"It doesn't matter that a token on Base isn't actually run by Brian Armstrong. If a token goes down or a token gets rugged, the user is sad, and the only person to really yell at is not an un-DeFi person, it's Brian Armstrong, it's Coinbase, or it's Robinhood in this case."

Impact Score: 10

"And I also want to just see how much on-chain activity that this actually translates to. And there's a very real chance, let's say that Stripe turns it on for 20% of their clients, and it turns out that that amount in GMV and volume and stablecoins is like nothing we've ever seen before in crypto yet."

Impact Score: 10

"I'm very curious—the thing that I'm waiting for is how Stripe approaches this, as effectively a B2B player where they're in a position to effectively issue stablecoins for other clients."

Impact Score: 10

"consortiums are very hard. They are extremely hard. And it's like a relationship where there's always one person doing more of the work, and the only person doing less of the work."

Impact Score: 10

"Speaking about the stablecoin piece, the fact that more than half of Circle's revenue goes to Coinbase—it's 100% of everything on USDC, and 50% of all other USDC—and that's up for renegotiation next year..."

Impact Score: 10

📊 Topics

#artificialintelligence 100 #investment 6 #startup 6

🧠 Key Takeaways

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