Robinhood Markets (HOOD) has found its footing in recent days after a sell-off drove the shares down to $109.70, roughly 14% below their September peak. With the pullback losing momentum, attention has turned to the two fastest-growing corners of the company's business: tokenized stock trading and Robinhood Chain, its layer-2 network. Both have become central to the brokerage's growth story as demand for tokenized equities continues to build.

Robinhood Sees Strong Demand for Tokenized Stocks

Under CEO Vlad Tenev, Robinhood has positioned itself as one of the most significant players in the tokenization industry. The company currently offers hundreds of tokenized assets on its platform, and recent data show that growth is accelerating. In a statement this week, Robinhood said its tokenized stocks—blockchain-based representations of shares that trade on its platform—have generated $15 billion in cumulative trading volume, a milestone that underscores how quickly the niche is scaling.

That momentum is expected to continue in the foreseeable future after the Securities and Exchange Commission (SEC) granted the industry a five-year exemption, a regulatory runway that gives firms room to build out tokenized securities products.

The expansion stands to benefit Robinhood in several ways. First, it allows the company to roll out trading solutions globally at a faster pace, opening access to more markets. Second, tokenization is driving adoption of Robinhood Chain, the company's fast-growing layer-2 network.

Data show that the network's total value locked (TVL) has jumped to more than $1.05 billion, making it one of the largest chains in the industry. The network also holds over $324 million worth of real-world asset (RWA) tokens, a figure that continues to climb. For newly launched networks, TVL, stablecoin balances, and DEX throughput are the standard yardsticks investors use to gauge real adoption.

Other parts of the business are expanding as well. The stablecoin market capitalization on Robinhood Chain has held above $1 billion, well above older networks such as Cardano and Algorand. Decentralized exchange (DEX) activity is also rising steadily: the chain processed more than $53 billion in DEX volume last month and has already handled $13 billion so far this month. Cumulative DEX volume since the network launched a few months ago has crossed the $100 billion mark, generating more than $46 million in fees, 10% of which flows to the Arbitrum Foundation.

Analysts Remain Bullish on HOOD

That growth has underpinned an increasingly bullish view of the stock on Wall Street. In a CNBC interview, Adam Frisch, a top Evercore analyst, said the company has “many irons in the fire,” pointing to several catalysts he expects to support the shares in the coming months. Frisch has a price target of $130, about 20% above the current level.

Other analysts are even more constructive. Morgan Stanley's Michael Cyprys has a $160 target, implying roughly 46% upside from current levels. Bank of America's Craig Siegenthaler sees the stock at $156, while Compass Point has set a target of $145. The average analyst target stands at $130, up modestly from $125 last month.

The next major catalyst will be the company's upcoming earnings report, which is expected to provide more color on the state of its business. Analysts forecast that third-quarter revenue rose 12% to $1.43 billion, followed by $1.52 billion in the following quarter. Investors will be watching how much of the surge in tokenized trading and Robinhood Chain activity shows up in those reported figures.

Technical Picture Points to a Potential Bottom

On the charts, the daily timeframe shows that HOOD has pulled back over the past few weeks, though recent price action offers signs that the stock is bottoming out. The shares have formed an island reversal, a pattern commonly viewed as a bullish reversal signal, and are trading within an ascending channel while holding above both the 50-day and 100-day moving averages. The Stochastic oscillator has remained in positive territory.

Should these patterns hold, the shares could rebound initially toward the $126.65 resistance level. A move above that threshold would point to further gains, potentially toward the $150 resistance.

This article is for informational purposes only and does not constitute financial or investment advice.

Source: The Market Periodical