Robinhood said it chose to build on Ethereum with a Layer 2 network rather than launch a new Layer 1. Johann Kerbrat, general manager of Robinhood Crypto, said the decision came down to two main issues: decentralization concerns on some non-Ethereum chains and the advantage of Ethereum’s existing infrastructure and liquidity connections.
Robinhood questioned the structure of some Layer 1 networks
Kerbrat said several large non-Ethereum Layer 1 networks still face centralization issues. He pointed to incidents in which validators appeared to restart systems at the same time during disruptions. In his view, that kind of coordinated response raises questions about how decentralized those networks really are. Ethereum, by contrast, already offers infrastructure that developers can build on without having to recreate the base layer from scratch.
He said that foundation gives builders security without extra engineering work. That changes how teams spend resources. Instead of maintaining core network functions, they can focus on applications and services, which was one of the factors behind Robinhood’s technical direction.
Interconnected liquidity inside the Ethereum ecosystem mattered
Kerbrat also described liquidity access as a major reason for the choice. Ethereum is linked with many EVM-compatible chains and decentralized applications, creating an environment where liquidity is already connected across ecosystems. For a financial services platform, he said, that structure offers a practical advantage.
A standalone chain would have a harder time attracting the same level of activity. Kerbrat compared isolated networks to private islands, where users and assets cannot move easily between ecosystems. Robinhood wants its services to operate inside a broader financial system, with open access rather than closed infrastructure.
Fee revenue was not the main focus in early planning
Kerbrat said Layer 2 economics differ from one project to another. Some networks push transaction fees very low, while others capture part of Ethereum’s fee structure. But he said Robinhood did not center its early planning on fee revenue. The company put more weight on accessibility and on integration with existing liquidity networks.
According to Kerbrat, Robinhood wants to support financial systems running directly on-chain. That is why the company chose a Layer 2 model connected to Ethereum instead of launching a separate Layer 1 chain.