Robinhood plans to build layer 2 Depth analysis on Arbitrum

The news that Robinhood plans to build a layer 2 on Arbitrum has attracted widespread attention in the industry. From a technical perspective, Robinhood's choice of Arbitrum's Nitro tech stack is similar to Coinbase's choice of Optimism's OP Stack tech stack. However, the success of Base indicates that the advantages of a tech stack do not directly translate to the success of the parent chain.

The rise of Base is largely attributed to the brand influence, compliance resources, and user acquisition capabilities of Coinbase. This provides some reference for Robinhood's choice of Arbitrum. In the short term, this news may not directly lead to the conclusion that the ARB coin price is undervalued. However, in the long run, if Robinhood successfully realizes the scenario of "U.S. stocks on-chain," it could change the current situation of layer2 as an "application-less technology" for Ethereum expansion, opening up an unprecedented path for large-scale applications in the Ethereum ecosystem L1+L2.

Unlike Coinbase, Robinhood may take a specialized layer 2 approach, specifically customizing a suitable on-chain infrastructure for traditional finance. Although the transaction confirmation speed of OP-Rollup has reached sub-second levels, the security of such transactions still falls within the optimistic Rollup category of 7-day fraud verification. Robinhood's new layer 2 needs to handle features such as T+0 settlement for stocks, real-time risk control, and compliance requirements, which may require deep customization at the virtual machine level, consensus mechanism, and data structure of layer 2 to fully leverage the potential of Layer 2 scaling solutions.

Arbitrum's technical solution indeed has its unique advantages compared to Optimism: the Nitro WASM architecture has higher execution efficiency, suitable for handling complex financial calculations; Stylus supports multi-language development of high-performance contracts, capable of carrying heavy computational tasks of traditional finance; BoLD addresses the issue of malicious delay attacks, enhancing the security of optimistic validation; Orbit supports customized Layer 3 deployment, providing sufficient flexibility for development features.

These technological advantages seem to perfectly align with the traditional finance's strict "customization" requirements for infrastructure. In the face of the ultimate challenge of supporting trillion-level traditional financial services, the maturity and specialization of technology will become key factors.

The on-chain trading of US stocks and cryptocurrency exchanges no longer face speculative users from the traditional crypto circle, but rather a user base accustomed to traditional financial products. These users are familiar with millisecond-level response, 24/7 service, and T+0 seamless settlement experiences. More importantly, they are often backed by institutional funds, algorithmic trading, and high-frequency strategies, which have extremely high demands for system stability and performance. This means that Robinhood layer2 will face unprecedented challenges.

Overall, the significance of Robinhood's layout of layer2 is substantial. This is not just a new player in the layer2 tech stack, but also a critical experiment to validate whether cryptocurrency infrastructure can support the core operations of the modern financial system. If the experiment is successful, it will accelerate the digital reconstruction process of the entire trillion-dollar traditional financial markets, including bonds, futures, insurance, and real estate. In the long run, this will directly benefit the application scenarios of the entire Ethereum L1+L2 ecosystem's technological infrastructure and will redefine the value capture logic of Layer2.