Within the controversy that brews over the tokenized -shares of Robinhood

OpenAi made an unauthorized attempt to token his equity on Wednesday, after a revelation by Trade Platform Robinhood that it had mentioned digital stocks as “OpenAi” and “SpaceX” earlier in the week.

Chatgpt Creator OpenAi pushed back on tokenization on Wednesday, after the unveiling by trading platform Robinhood from OpenAi and SpaceX Stock tokens on Monday.

In a post on X, OpenAi said that the tokens do not represent equity in the company and that it had no involvement in their launch.

“We did not work with Robinhood, were not involved and do not endorse it,” wrote OpenAi. “Every transfer of OpenAi -own capacity requires our approval – we have not approved any transfer.”

In a response to the post of OpenAi, Elon Musk CEO by SpaceX and Tesla, and a co-founder of openly-reacted, “your” equity “is fake.” Musk separated roads with OpenAi in 2018 after disagreement about the direction of the company and the transition from a non-profit to an entity-covered entity.

According to Robinhood, the OpenAi tokenized shares are launched on the Ethereum Layer-2 Scaling Network, Arbitrum.

In a statement, Robinhood said that the tokens investors give ‘indirect exposure to private markets’.

“To take out our recent crypto event, we have announced a limited shareholding -way action on OpenAI and SpaceX for eligible European customers,” said a Robinhood spokesperson in a statement. “These tokens provide retail investors indirect exposure to private markets, open access and are made possible by the ownership of Robinhood in a vehicle with a special purpose.”

As Robinhood has explained, share to -do not offer many of the same benefits as traditional shares, such as owning the underlying shares or voting rights.

“You don’t buy the actual shares when buying stocks,” wrote Robinhood. “You buy tokenized contracts that follow their price, recorded on a blockchain.”

Some investors pushed back on the reaction of OpenAi and claimed that the tokens are still a reflection of legitimate exposure to the company.

“OpenAi postpones this statement to be safe because they have to be safe,” wrote investor Amit Kukreja on X. “The only thing that Robinhood did was establish a token that follows the valuation of OpenAI on private markets. You do not literally buy shares in those companies, but shares are just certificates; the digital representation of that Activa is everything of things.”

Although Robinhood said that the price of the stock tokens will be displayed in USD, American customers may be excluded from buying them due to legal restrictions.

“When selling stocks, you can always sell them for their value in euros,” said Robinhood. “You cannot send stock to other portfolios or platforms at the moment.”

Tokenization converts the ownership of Real-World assets, such as shares, real estate or artworks-in digital tokens on a blockchain, making them easier to act or share. The problem is that OpenAi is not a listed company.

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Kurt Watkins, founder of the US -based company Watkins Legal, said Decrypt The offer would probably be “commercially not viable” in the US due to the lack of transparency and legal ambiguity.

“Robinhood’s OpenAI tokenized Equity product would be confronted with serious SEC supervision in the US because of the fundamental opaque SPV structure that hides critical investment protection,” Watkins said. “It is crucial that there is no guarantee that the tokens will actually follow the price of OpenAi, because they have no useful underlying rights and can experience liquidity problems.”

He continued: “Openai’s explicit rejection that these tokens” are not open equity “and that no transfer has been approved, exposes the illusory nature of the investment, which creates precisely the type of misleading financial product that securities laws have been designed to prevent.”

“Even with the disclaimers of Robinhood, this cover in combination with Clear Howey Test Securities classification would cause registration requirements of the registration that require much more extensive disclosure than is currently provided, so that the product is probably not commercially feasible on the American market,” added Watkins.

Criticism has also been levied against the design of Robinhood’s Tokenized contracts with REN, a partner in the investment team of Electric Capital, who labels a ‘walled garden’.

“I have just decompiled the tokenized stock contracts of Robinhood. It is a walled garden, each transfer checks a register of approved portfolios (KYC/AML),” tweeted run on Tuesday.

“It is unlikely that these tokens can communicate with Defi,” he added. “It is quite possible Cefi with distribution, just the existing Defi protocols.”

In other words, centralized financing – such as Robinhood – can get the upper hand, not because of innovation, but because the user arranges on boarding and distribution.

Decrypt reached for electric capital for further clarification about those points. Maria Shen, a general partner at the company, created a group cat between Ren and DecryptBut Ren went out quickly without comments. Shen later removed the group and described the exchange as a miscommunication and that Ren had refused to comment.

OpenAi and Robinhood fell Decrypts Requests for comments.

Edited by Sebastian Sinclair” Vince Dioquino has contributed to this report.