Let’s start off by sharing that the author of this Op-ed is actually somewhat of a fan of Vlad Tenev. I’ve followed his career very attentively and perhaps even obsessively over the past seven years, and I have a lot of respect for all that he’s managed to do on Wall Street. But as we watch his influence in crypto grow more and more, we can’t help but point this out:- Vlad Tenev does not like decentralization. That is a problem. He made his fortune pushing a “free market” trading app, but when it really mattered, he shut the market down. Now he is acting like he supports crypto, but history says otherwise. And if allowed, he’ll become a massive cancer to the crypto industry. Let’s start from the very beginning. Who is Vlad Tenev? Vlad Tenev is the co-founder and CEO of Robinhood, the company that turned stock trading into a mobile game. Born in Bulgaria, he moved to the U.S. at the age of five, where both his parents worked for the World Bank. He attended Thomas Jefferson High School for Science and Technology in Virginia, later earning a mathematics degree from Stanford University. At Stanford, he met Baiju Bhatt, his future business partner. The two started their first company, Celeris, in 2010, a high-frequency trading software firm. By 2011, they pivoted to Chronos Research, which sold low-latency trading software to banks and hedge funds. Then, in 2013, they launched Robinhood, a commission-free trading app designed to attract retail investors. Robinhood went public in July 2021 at a $32 billion valuation, making Vlad and Baiju billionaires. But before that, in November 2020, Vlad took over as sole CEO, dropping the co-CEO arrangement with Baiju. Baiju Bhatt and Vlad Tenev, the founders of Robinhood. Credits: New York Times In December 2023, Vlad spoke with Axios about his career. When asked if he would still start Robinhood knowing he would be vilified, he said , “Oh, absolutely.” He claimed he always knew Robinhood would disrupt the financial industry and expected pushback. When discussing co-founding a company with friends, Vlad said, “Building a company with someone who you trust deeply is actually critical.” He dismissed the idea of work-life balance, calling it “a strange way to live” and compared it to the concept in the show Severance. Instead, he argued that work should feel like “a different type of play.” Vlad also warned against working with people you haven’t known for years, saying, “You don’t know what that person is going to be like under various circumstances when things get tough.” Vlad shut down GameStop retail trades to protect Wall Street In 2021, retail traders fought back against Wall Street. They targeted hedge funds that were betting against GameStop (GME) and other stocks. The result? Billions in losses for big firms. But just when retail traders had all the momentum, Robinhood blocked their trades. People were outraged. Congress got involved. Vlad was questioned. A lawsuit was dismissed, but the damage was done. And now, he wants in on crypto. The GameStop short squeeze exposed how far Robinhood would go to protect powerful investors. At first, everything looked like a win for retail traders. Keith Gill (Roaring Kitty) started the movement, and millions joined. Hedge funds were losing money fast. But on January 28, 2021, Robinhood blocked buy orders for GameStop and other heavily shorted stocks. Users could only sell. Vlad blamed clearinghouse deposit requirements. The real issue? Robinhood’s biggest clients were Wall Street firms that paid for order flow data. If hedge funds went under, Robinhood lost money. “Every time we would talk about what Robinhood aspired to build, people would say ‘Oh, the big brokerage houses and the big financial firms are not going to like this. They’re going to do everything in their power to stop you,’ and of course, we’ve seen that,” Vlad said in December 2023. That was his excuse. But Congress did not buy it. When Vlad testified on February 18, 2021, lawmakers from both parties tore into him. He struggled to answer questions. He denied that Robinhood colluded with hedge funds. But at the same time, federal investigators got a search warrant for his phone. Later, in July 2021, Robinhood’s IPO filing confirmed it: The U.S. Attorney’s Office was investigating Robinhood’s role in the GameStop crisis. But if Vlad had disappointed the Wall Street gods, who would’ve backed Robinhood in the IPO? He needed those guys more than he needed retailers that year. Vlad is now trying to control crypto markets After the GameStop scandal, Vlad shifted his focus. Robinhood jumped into crypto trading. By February 2024, it reported $14.4 billion in crypto trades. That was a 29% drop from the previous month, but still double the previous year. Now, Vlad is aligning himself with Trump’s policies. He recently praised the administration’s approach to crypto and AI regulation. He claims the U.S. will lead these industries under clearer rules. “They’ve got smart people thinking through these problems,” he said. Vladimir Tenev. Source: Fortune Magazine Vlad is also expanding Robinhood’s betting markets. His company now offers prediction markets, where users can bet on things like elections, similar to Polymarket. But he insists it is not gambling. “What that allows is better price discovery,” he said. At the end of February 2024, Robinhood held $187 billion in assets. That was an 8% drop from January but a 58% increase from the previous year. Net deposits hit $4.8 billion, with an annualized growth rate of 28%. Robinhood is positioning itself as a major player in crypto trading and prediction markets. But the same man who froze GameStop trades now wants to control crypto markets. The question is: Will he do the same thing again?
