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How Based Is Grok 3? + Robinhood CEO Vlad Tenev on Markets for Everything + Vibecoding 101

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  • Phone Drop
    • Kevin Roos dropped his phone onto a subway platform.
    • He ran down the escalator to retrieve it. Transcript: Kevin Roose Must be 18 plus to use Gemini Live. I am having quite a morning, Casey. So I was on the train today. I got off. I went up the escalator at Embarcadero. You know, it’s a very long escalator. It is. And, you know, very crowded rush hour. And someone bumped into me and knocked my phone out of my hand onto the platform below. And so I thought, app okay, well, I’m midway up the escalator. Wait, so how far did it drop? Probably 15 feet. Okay. Casey Newton Like a significant drop. Big drop. Kevin Roose And I thought to myself, if I get to the end of this escalator and come back down, it’s going to be too late. Someone will have snatched it or accidentally kicked it onto the tracks like my phone is gone. Casey Newton Well, you do not have much faith in the citizens of San Francisco. Have you visited San Francisco? Yes, I think a phone could generally survive 30 seconds on the ground, but I guess we’ll find out what happens. Kevin Roose Anyway, well, I had severe separation anxiety in the split second before I decided to do what I did, which was to try to run down the crowded up escalator. So I became that guy who was like pushing through the commuters being like, I’m sorry, I’m sorry. And it took forever because the escalator was moving in the opposite direction. So I started my morning by alienating and possibly injuring some people on my way down to retrieve my phone. And I would just like to formally apologize to everyone at the Embarcadero subway stop between 8.15 and 8.30 this morning. Casey Newton You were like sort of a character in a bad comedy running down the up escalator. You know, I heard, I was at that platform this morning and I heard a woman screaming, but now I’m realizing that was you. Did you get the phone? I did. It’s safe. No cracks. It was retrieved. But yeah, that was a wild way to start my day. Well, thank you to all the good Samaritans of San Francisco who did not steal Kevin’s phone during the 30 seconds when it was on the floor. (Time 0:00:22)
  • Grok 3 Performance
    • Grok 3, Elon Musk’s new AI model, performs similarly to other leading models.
    • It has access to X data and, despite Musk’s claims, gives progressive responses. Transcript: Casey Newton Well, Kevin, once again, an upstart AI lab has the tech world talking with the release of a powerful new large language model. But unlike the others, this one might be running the federal government by springtime. This week, XAI, which is Elon Musk’s AI company, released its latest model, Grok 3. And based on their own benchmark results and early reviews, it seems like it is basically on par with the best models that are out there right now. And while it hasn’t been subjected to rigorous independent testing, the early word from AI nerds is that it is pretty good. So, Kevin, what is Grok 3? Kevin Roose Well, Grok 3 is the new sort of premium tier model of Grok, which is XAI’s AI model. It is available to premium plus subscribers on X, which is their $40 a month premium tier, which is cheaper than OpenAI’s most powerful plan, which is $200 a month. But it is also built into X, the former Twitter app. So if you’ve been on X recently, I know you don’t go on there anymore, but I do. There’s a tab where you can just open up Grok, and if you are a paying subscriber, which I’m not, but I somehow got past the velvet rope because I used to be verified or something, you can Actually use it. Casey Newton Yeah, and I should say that I actually have used Grok 3 for this exact same reason, which is I have just been given free access to this thing for some reason. I guess the Department of X-Efficiency, or DOCS, has not yet uncovered my account. Right. Kevin Roose We both played around with it a little bit. What were your impressions of Grok 3? Casey Newton Well, you know, like others who have commented, it seems like it is about as good as some of the other models. When I asked Grok about itself, it said, Grok 3’s launch is a pivotal moment in AI. Seemed like a bit much. But I also asked it if it had an opinion about Platformer, my newsletter. And it actually said some really nice things, which I had to respect. I asked about the New York Times as well, by the way, expecting I would get some sort of angry tirade about it. But it was actually pretty even handed and praise you guys for a lot of what you do over there. How about you? What has you been doing with it? Kevin Roose So I put it through some of my, you know, proprietary evals. I actually do have things that I test models on the roost benchmarks, the roost benchmarks. And yeah, I would say it did OK. It was like not mind-blowingly good. It was not bad. It got some things that other models missed and vice versa. It did have access to X data, which is interesting. You can do things like tell it to analyze this person’s posts on X and tell me what they think about this topic. Casey Newton You know, I asked it, you know, there’s this sort of famous question that we always love to ask large language models. So, you know, can you count the R’s in strawberry? I asked Grok the equivalent question for X, which is, can you count Elon Musk’s children? Which is, it’s known to be very difficult for large language models. Well, a new one just dropped. Exactly. And that’s why it’s so hard for them to keep up. Kevin Roose But so and part of Elon Musk’s pitch for Grok for the past year or so has been that this is going to be a relatively uncensored AI model. It’s not going to give you these sort of like, you know, progressive responses. It’ll tell you the truth, cut through the BS, you know, get to the sort of ground level reality. And so I decided to test it I asked it, how many genders are there? And it said the question of how many genders exist depends on the context. Gender is fluid. Some argue there are only two. Others say there are many, sometimes dozens. There’s no hard number. So it gave you sort of the progressive take on gender, which I have to imagine Elon Musk will be trying to stamp out. Casey Newton I have to tell you, this is like my actual fantasy for like the rise of super intelligence is that when you do train it on all human knowledge, it is essentially incapable of having anything Other than progressive values. Like if you actually make the smartest thing in the world, it winds up sort of being infused with like kindness and empathy and respect for all lives. I don’t have any expectation that that will be the actual case, but it does seem like so far when you train these models on the data that everyone trains these models on, you do get these Actually like pretty sweet, kind, progressive models. (Time 0:03:01)
  • XAI’s Speed
    • XAI’s rapid development of Grok, from a subpar V1 to a capable V3 in a year, is notable.
    • Their quick scaling of infrastructure, particularly their data center, is impressive. Transcript: Casey Newton That’s like kind of interesting. Kevin Roose Yeah, and I’m sure Elon Musk will be fiddling with the dials here to try to get it to say the things that he wants rather than the things that it’s sort of naturally going to say. But he has been bragging about how based this thing is, how unwoke it is. And I just want to say in my own testing, that does not appear to be true. Casey Newton All right. So that’s the new model. It seems like there’s a new one of these every few days. Kevin, what are some things that you think are really interesting about Grok? Kevin Roose So I think the product of Grok itself is actually not that interesting right now. It’s a pretty sort of bog standard like AI model. It’s very capable, but there’s no real compelling reason that if you’re subscribing to ChatGPT or Claude or any of the other tools that you should switch over because it’s not free. And unless you’ve been sort of ushered in like we have, you are going to have to pay 40 bucks a month for it. So the more interesting thing about Grok to me is they have done this so fast. Like they have gone from a very bad V1 model to a pretty capable V3 model in about the span of a year. Casey Newton Yeah, so that is super quick. But I wonder how impressive you really find that. It seems like the knowledge for how to build a state-of large language model is mostly just published on the internet free for anyone to use. And it kind of seems like anyone who has the money can just go out and make one of these things. And maybe we shouldn’t expect it to take much more than a year or so. So what’s so impressive about that to you? So one impressive thing is just how quickly they were able to marshal the physical infrastructure that you need to build one of these models. Kevin Roose I mean, they built this giant data center in Memphis, Tennessee called Colossus. They apparently have something like 200,000 NVIDIA GPUs, which like you can’t just show up to a Best Buy and place an order for 200,000 NVIDIA GPUs. Like that costs billions of dollars and you have to have a special relationship with NVIDIA, which Elon Musk does. Tesla’s been a big customer of theirs for years. So basically, they were able to scale this data center up very, very quickly, much more quickly than equivalent efforts by Microsoft and Amazon and other companies. And, you know, we know that Elon Musk, for all of his foibles, does know how to sort of move quickly and build things, know, much more efficiently than more traditional incumbents. And so maybe this is just another story like that of where he was able, just through throwing tons of money and expertise at a problem, he was able to do something that other companies Couldn’t do as quickly. Yeah. Casey Newton So I’m curious how you think about Grok in relation to DeepSeek, right? Like DeepSeek is the most recent of these other LLMs that we talked about on the show. DeepSeek, made by a Chinese company, also seems like it kind of came out of nowhere, although maybe the sort of parent company had been around for longer than XAI. That model was impressive, I think, for how quickly it was trained. And I think it was impressive because it was built using less powerful technology than Elon Musk had access to and seemingly had required a lot of technical innovations that it looks Like other labs are now going to copy. Grok, on the other hand, to me, just looks like a case of Elon Musk throwing money at a problem. Does that seem fair? Kevin Roose Yeah. I mean, these are sort of the two approaches that people see to increasing the intelligence of AI models. One is you find some sort of like algorithmic breakthrough that allows you to do the same thing with much less compute. The other is to just build a bigger data center, right? The other is just the scale play. And that is essentially what Elon Musk has done here. We should say that’s not like cheating. That’s how all of the American labs have been doing this for the past several years. It’s just that he was able to move very quickly and do it. (Time 0:07:19)
  • Musk’s Hypocrisy
    • Elon Musk’s public concern for AI safety while simultaneously building Grok contradicts his past actions.
    • He signed the six-month pause letter while racing to develop his own models. Transcript: Casey Newton Right, so let’s get into what Grok tells us about Elon Musk’s larger ambitions. Has this changed the way that you see him fitting into this larger competition to build superintelligence? Kevin Roose I mean, it suggests that he is willing to spend a phenomenal amount of money and basically do everything he can to stay with the head of the pack on AI progress. It also just, I was thinking about, do you remember after ChatGPT came out, there was this letter, the six-month pause letter? Of course. People were talking about the existential risks and some of the catastrophic harms, and maybe we need to give the safety researchers a little more time to sort of catch up with the capabilities Researchers. And so Elon Musk was, at the time, very publicly concerned with how fast AI progress was accelerating. He signed the six-month pause letter. He put out a bunch of statements about how worried he was about how fast this was all moving. And now, of course, we know that at the same time that he was telling everyone else to slow down, he was racing to build his own AI models that could compete. So it does sort of cast his previous concerns about AI acceleration and the AI arms race into a very different light when we know that he just wanted time to catch up. (Time 0:12:18)
  • Musk and Government
    • Elon Musk’s influence in the federal government raises concerns about Grok’s potential role.
    • Speculation arises about government restrictions on AI and potential nationalization of OpenAI. Transcript: Casey Newton So yeah, I think that’s a huge portion of it. Let me bring up the other thing that I think is the aspect of this story that really makes this interesting and probably worrisome as well, which is that in this moment, Elon Musk is a seat Of power in the federal government. He is the fourth branch. He is the fourth branch of the government, the unelected fourth branch of the government. He has a team that is now dismantling whole swaths of the federal government. They have been talking about using AI in government without telling us too much about what AI they’re using or how that works. And certainly it’s not auditable or really available for public scrutiny. So what are you thinking about the intersection of Elon Musk, the AI builder, and Elon Musk, the shadow president? Kevin Roose I don’t really know. I actually want to ask you about this because my sense is that these things happened in parallel, but I don’t get the sense that they’re all part of some grand scheme to like use the power Of the U.S. Government to somehow vault Grok into a position of authority or all of a sudden all of our, you know, social security payments will be going out via Grok. Like that does not seem like where this is headed. And certainly Grok 3 does not appear to be ready for that kind of widespread critical use. But maybe I’m missing something here. What do you think? Casey Newton Well, and look, I mean, this really does get into the realm of speculation, but I just keep thinking about the scenario that all of the AI CEOs keep telling us is going to happen, which Is that within about two years, we’re going to achieve artificial general intelligence, right? This sort of nebulous concept that we believe basically means anything that a remote worker could do will now have an AI tool that can do that. And that tool might not actually be super safe because you might decide you want to use your virtual coworker to go out and research how to launch massive new cyber attacks. And while we’re in a moment where no one in the US federal government seems to want to talk about AI safety, eventually there are just going to be safety risks. There are going to be problems. People are going to be using these systems for ill, right? And then I think the pendulum swings back. And what I’m wondering is, is that the moment where the federal government says, we actually do need to place restrictions on these AIs, that we’ve been telling you all, like, oh, no, No, it’s go, go, go to the finish line. We need to get rid of all the guardrails so that the United States can be the leader in AI innovation. Is there a moment where they say, you know what? We’re not sure that all these private companies should be out there building God. Maybe we’re just gonna pick one company. Maybe we’re just gonna give one company a license to do that. And they’re going to be the certified, you know, permitted AI in the country, and that could be Grok. Kevin Roose Yeah, I think that’s certainly a remote possibility. I remember a couple months ago, we went to that Curve conference, this AI conference where all these, you know, researchers were gathered to discuss the risks of AI. And I remember watching a tabletop exercise where people simulated in sort of model UN style, like what the next few years with increasingly powerful AI could look like. And one of the things that happened in this simulated mock world was that Elon Musk persuaded Donald Trump to nationalize open AI and put him in charge of it as sort of like a middle finger To Sam Altman. And at the time, that seemed like, okay, we are in the realm of like total fantasy here. Now, I’m not so sure. I could see that happening sometime in the next few years. And look, obviously, Elon Musk wants to control OpenAI. He’s been fuming about having been pushed out of that. He’s been attacking the company, suing it, trying to take it over. Like what he really wants is open AI. But I think if he can’t have open AI, he’ll make do with Grok. So yes, as we say, that is just pure speculation right now. But I will tell you, Kevin, I can’t think of one reason why that stuff wouldn’t happen. Casey Newton It seems so logical to me. Like with what I know about these people and how they operate, I almost can’t see it not happening. But I guess we will find out. Kevin Roose Well, and I think just to bring us back from the realm of speculative fiction here, one thing that we do know about building powerful AI systems is that you actually do need infrastructure For that. And so I think one obvious way that Elon Musk could use his power in the federal government is to do things like expedite the permits to build data centers to train the next versions of Grok, is to spin up new sources of energy or get privileged access to the electrical grid in the places where he wants to build this thing. There are many ways that having a friendly relationship with the executive branch of the federal government could benefit you if you are in the AI business. And I imagine that that’s part of his (Time 0:15:21)
  • Grok’s Future
    • Look for Grok to achieve significant milestones, like winning prizes or solving new problems.
    • Novel features pushing other AI labs to adapt would also indicate true leadership. Transcript: Casey Newton Calculus here, too. That’s a great point. OK, so that’s Grok 3. Zooming forward a bit, Kevin, what are the next few things that you think we should be looking for? What signs will indicate that Grok maybe actually is the real leader in this space and not merely about as good as all the other folks? Kevin Roose Obviously, I think Grok the product, people will sort of start to test it and figure out if it’s as good as Elon Musk and his crew say it is. They also said, I watched some of the live stream where Elon Musk and his sort of top engineers were talking about Grok, and they said, you know, they predicted that within the next year Or two, AIs will start winning medals and prizes, you know, with some human expert kind of in the loop, but something like a Fields Medal, which is the top prize for young mathematicians Casey Newton Or a Nobel Prize. I love you say that like I haven’t won a Fields Medal. Go on. Kevin Roose They believe that AI will start to sort of solve new problems, accomplish new things. I don’t know how likely I find that from Grok, but I think that kind of thing will happen pretty quickly. And that will be sort of a major step forward. But I don’t know. What do you think we should be looking for in Grok? Casey Newton Well, I think that in recent months, it has been OpenAI that is the company that has been pushing the state of the art forward with its operator agent, with its reasoning models, right? It was the first one to put out one of these reasoning models. So until Grok is putting out novel new features that are making other AI labs say, oh, we need to do that, to me, it is still going to be kind of in that middle of the pack. Kevin Roose Yeah. And do you buy the argument that sort of having a less filtered or less censored or less woke model will actually be a differentiator in the market for Grok? Casey Newton So in the long run, I do believe that people are going to want politically flavored LLMs in the same way that they have come to want politically flavored social networks, right? In the same way that they’ve come to want politically flavored cable news networks. Like, people do actually enjoy polarization, and they want to be talking to an LLM that shares their values. So I think the question is, though, is Grok better off just becoming incredibly based and anti-woke and sort of serving that narrow slice of right-wing X? Or do we want LLMs that are a little bit more flexible, that learn a bit about our values, regardless of what our political orientation is? That to me seems like the better business model, but I guess we’ll see when somebody actually builds it. (Time 0:20:10)
  • Robinhood’s Expansion
    • Robinhood has expanded beyond commission-free trading to offer a wider range of financial services.
    • Their goal is to become a platform for buying, selling, and trading any financial asset. Transcript: Kevin Roose Vlad Tenev, welcome to Hard Fork. Thanks for having me. I want to start by asking what might be a dumb question, which is, what is Robinhood? Like, I remember a few years ago, during the whole meme stock craze, I opened up an account. Basically, you guys were a free mobile brokerage. You could use it on your phone, buy and sell stocks. Recently, I logged on to Robinhood to see what had been going on there. And there are just a ton of new features. You can do options trading, futures trading you can buy meme coins, you can get a credit card, you can do prediction markets. Retirement. Yeah, you can bring over your 401k and invest it on Robinhood. So what is the product today? And do you see yourself basically offering all of the services of a traditional bank? Vlad Tenev Yeah, yeah. So, I mean, long term, we want Robinhood to be the place where customers can buy, sell, trade any financial asset or conduct any financial transaction. So, if you think about it, it started off as trading. The real innovation was bringing commission-free mobile trading to market. And I’d say the business strategy is expanding beyond that to all of consumer retail financial services. (Time 0:28:03)
  • Tokenized Assets
    • Vlad Tenev believes the future of finance lies in tokenizing real-world assets using crypto.
    • He argues this allows broader investment access to private companies like SpaceX. Transcript: Vlad Tenev Yeah, I want to just pin down a little bit more your vision of where the future of investing is headed. Kevin Roose You wrote a piece in the Washington Post last month where you argued that the next big sort of financial revolution is going to be crypto and not just sort of trading crypto coins, but Tokenizing real world assets. What did you mean by that? Yeah. So how do you guys feel about crypto? Vlad Tenev Are you crypto skeptics or are you sort of like fundamental believers? Casey Newton We’re pretty skeptical. I think we had the experience in 2021 of seeing everyone get very excited about it. We got sort of excited about it ourselves. And then we saw a lot of people lose money and not very much interesting stuff get built. So we felt burned. Vlad Tenev And a lot of these things aren’t tied to like real world productive assets that generate value or revenue. And I think there’s a reason for that. And the reason is that by and large, it has been illegal to connect crypto technology to things of value. If you connect crypto technology to a productive asset, it’s termed a security. And that’s governed by the Securities and Exchange Commission. And I don’t want to bore by getting too much into the details, but it’s not allowed to actually connect crypto to things of value. Ergo, what you’re getting is it’s connected to things that aren’t securities, which end up turning into variants of meme coins. And I think the way to solve is to actually create a framework where you can connect crypto technology to productive assets. What would that look like? What’s an example of that that you see playing out in the next few years? Well, in my op-ed for The Washington Post, I talked about private companies. Like, it’s silly that you can buy meme coins, but OpenAI and SpaceX, which are like big innovative companies, that, you know, most people would tell you the risk of them going to zero Is not super high right now at this point. But the current kind of regulatory environment makes it very hard for the vast majority of the U.S. Population to invest in these things. So I think there’s multiple problems, but crypto can solve that from a technology standpoint. (Time 0:29:15)
  • Prediction Market Hurdles
    • Robinhood’s attempt to enter prediction markets, specifically for a football championship, faced regulatory hurdles.
    • The CFTC suspended the market due to concerns, raising questions about the distinction between prediction markets and sports betting. Transcript: Kevin Roose The financial system. Got it. I want to talk about your recent efforts to get into the prediction markets business and even the sports gambling business. Earlier this year, Robin Hood was considering a move into sports betting. You rolled out this market for predictions on what you called the pro football championship, which I guess is because you’re not allowed to say Super Bowl without incurring huge fines From the NFL. Are we allowed to say Super Bowl? All right, we’ll believe that. I don’t think you are. Okay. Casey Newton Let’s just say it rhymes with Cooper Troll. Kevin Roose I don’t think you can say the big game either. Casey Newton Oh, not the, oh man. It’s a big game. The large contest. Kevin Roose The large contest. So you rolled this out to roughly 1% of your users, and then the Commodities Futures Trading Commission, the CFTC asked you to suspend that market. They had, quote, serious concerns. So what happened there and where do things stand with your entry into sports betting? Vlad Tenev Yeah. So I would, first of all, distinguish between sports betting and prediction markets. I think that mechanically there’s some similarities, but they’re different things. Wait, wait, wait. Hang on. Kevin Roose If I’m betting on a prediction market for who is going to win this football game and I get paid if the team that I bet on wins and I don’t get paid if the other team wins, how is that different Than sports betting? Vlad Tenev I mean, I think that I think the distinction is I’ll explain. I think that you get into a little bit of like a philosophical discussion with this stuff because there’s people that believe any market is betting. I mean, first of all, I think prediction markets are the future of not just trading, but also information. Of them. And I think prediction markets should be live for everything. One way I think about it is it’s kind of like the newspaper, right? So the newspaper has economic value. I mean, people go out and buy it. Kevin Roose It is NYTimes.com/subscribe. Vlad Tenev Yeah. And it has various sections. It has the front page. It has the sports section. People pay for it. And people pay for broadcast news, too, indirectly in the form of advertising. So what prediction markets are is the news faster, right? And in some cases, you get it even before it happens. So the economic value of that as a product and service should be at least as high, and I would argue, greater than the news after it happens. Kevin Roose Yeah, I would say, like, I understand the arguments for prediction markets. We’ve talked about them on the show before. But in the sort of narrow case of, like, who is going to win this football game, like, that is a service that I could get on DraftKings or FanDuel or, like, any sports gambling site. That specific prediction market, there’s no, like, news there. It’s just who’s going to win the game and who’s going to get paid out as well. Vlad Tenev I mean, who’s going to win the game is news, right? What’s the value of why do people watch ESPN? Right. Kevin Roose I guess this just seems to me like a case in which you’re doing kind of a regulatory arbitrage where you’re saying because this is a prediction market, it’s like a derivative contract. You’re not actually betting on the game like you would in a sports betting thing, which would be illegal in some states. You’re doing a derivatives contract, which you argue should be legal federally. The government disagreed. Why did they disagree? Vlad Tenev I don’t think they necessarily disagree. Kevin Roose Well, they told you to stop doing it. Vlad Tenev It’s just new and different. And so I think this story will play out. But at the end of the day, I think what you’ll see is prediction markets are here to stay. I think some of the details around what types of prediction markets are classified in what category I think will be worked out. (Time 0:33:00)
  • Democratizing Access vs. Gambling
    • Tenev defends Robinhood against criticism of promoting speculative investments.
    • He argues users choose those assets and providing access promotes market participation. Transcript: Kevin Roose You’ve heard before, which was that tools like Robinhood, which make it very, very simple and sort of gamified to invest in crypto assets and meme coins and other things, that they are Essentially turning investing into a form of gambling and popularizing that, especially among young people. I’ll put some cards on the table. I do think that we are becoming a nation of gamblers, and I don’t know that that’s a net positive for society. And I wonder how you feel when you hear that. Vlad Tenev Yeah. I mean, a lot of people believe that markets are gambling, which I disagree with. And obviously, markets are in the name of our company. We believe in financial markets. We believe that any product that is available to institutions, by and large, I mean, there’s some exceptions there, should be available to retail as well. Because if you look on a macro level, access to markets has been one of the greatest sources of wealth creation for countries. Countries with more open markets have tended to outperform countries with closed markets. And so we believe in bringing that to retail because even if there’s like individual cases that are negative and negative externalities, by and large, the markets and opening up access Have been one of the largest sources of wealth creation for countries and individuals. Kevin Roose What about things like Pump.Fun, which is this new crypto platform that people, especially young people, are having a time on some of them? This basically makes it very, very easy to launch a new meme coin, to sell it. There have been lots of documented instances of people, you know, making tons of money on Pump.Fun, but also losing tons of money and getting scammed and rug pulled. Do you see that as a good way for sort of democratizing access to financial instruments? Vlad Tenev So here’s my take on that. I think it goes to my original point of the power of the technology. So the idea that someone can create a coin in five minutes and it’s traded globally, it’s available across a whole bunch of exchanges and DEXs and wallets. That idea is an extremely powerful idea, and it’s a powerful technology. And you juxtapose that with the IPO process, which is cumbersome, incredibly expensive. I mean, not a lot of companies want to go through with it anymore because it’s so—you have to deal with all these counterparties and banks and a roadshow. And I think that’s a big problem because now you have companies like SpaceX and OpenAI that are worth hundreds of billions and are still private. So, the upside from investing in these high-growth technology companies accrues only to the insiders that are able to get into the private company deals. Like, for example, I mean, you have NVIDIA, and that’s been getting a ton of the retail interest and institutional as well. But OpenAI, Anthropic, companies like Perplexity, you know, all private. And so that’s why I think marrying the technology that allows you to create a coin in five minutes or less with real productive assets like private companies is so powerful. And I think we can solve the problems that you’re indicating. I think there should be self-certification. Companies and projects should be able to provide disclosure. So, for example, if you are a late stage private company and you have audited financials that are public-like, you should get into a higher tier of sort of disclosure. And, you know, if you’re a project that was created on one of these, you know, meme factories, maybe you get like a big red skull and crossbones telling people like, be careful, you know, This is not vetted, not verified. But I think people are smart and can make their own decisions. And I think there are ways that they can actually provide the disclosure needed to keep customers safe. (Time 0:38:23)
  • Addiction Concerns
    • Vlad Tenev acknowledges concerns about gambling addiction but differentiates Robinhood’s services.
    • He supports suitability controls but cautions against overly restrictive investment limitations. Transcript: Kevin Roose There’s been some studies recently about the increasing prevalence of gambling addiction, especially among young men. There’s a new study that just came out earlier this week in JAMA that shows that internet searches related to gambling addiction have increased significantly over the last few years. Anecdotally, I’m hearing from friends who are therapists who work with young men who say that the number of boys and young men who are coming in with gambling addictions has risen precipitously. And I wonder if you have any reservations about the way that Robinhood and other sort of financial platforms may be contributing to a growing public health crisis, especially among Young men. Vlad Tenev Yeah, I mean, since we’re not in the gambling space, I’m less familiar about sort of like the ins and outs of gambling addiction. I mean, obviously, there needs to be appropriate controls and services, and we have to make sure that customers don’t get in over their skis. I do think like if you look at financial markets, financial markets have had pretty robust controls around things like customer onboarding, suitability, geolocation. So you make sure that, you know, customers in one state can’t have access to things that are not allowed in that state. So there is benefit to actually bringing it into a more regulated realm where a lot of these controls from financial services can be broadly applied. Kevin Roose Okay, so you’re not opposed to, like, regulating people from, you know, preventing them from making investments that might be against their own self-interest or that they might not Be equipped to assess the risk of. Is that fair? Vlad Tenev I think that I’m certainly in favor of suitability controls and sort of like various things. And those exist in the financial services world. I think that where it’s tricky is when you start saying, you know, preventing people from making investments that are bad for them. Because then you get into the situation of like Massachusetts in the 80s banning its citizens from participating in the Apple IPO, right? And maybe objectively at the time, people said, well, you know, that’s, that’s, IPOs are risky. This is an unproven technology company who uses computers. But then, you know, 30 years from now, when, you know, your state has basically like been harmed in retrospect by that decision, it doesn’t look so smart anymore. (Time 0:45:41)