Contemptible, Outrageous, Vile”: Robinhood and AMC Clash Over Who Controls a Stock’s Identity

A public company typically has limited control over third-party financial products that reference its shares, but Robinhood Markets, Inc. (NASDAQ: HOOD ) and AMC Entertainment Holdings, Inc. (NYSE: AMC ) are now testing that notion in public, in one of the year's most intense corporate spats. The debate revolves over stock tokens and has evolved from a heated social media post on September 3 to a live televised retort by September 9.

Robinhood Markets, Inc. (NASDAQ:HOOD) expanded its tokenized shares offering, which is issued through a unit named Robinhood Assets (Jersey) Limited and traded on Robinhood's proprietary blockchain, Robinhood Chain, to include over 190 public firms, including AMC, without the companies directly signing on. When AMC CEO Adam Aron discovered that his company was among them, he did not mince words. On September 3, Aron posted on X, calling the practice "contemptible, outrageous, disgusting, detestable, inexcusable, vile," questioning how it could possibly be legal, and stating that AMC Entertainment Holdings, Inc. (NYSE:AMC) had no relation to the tokens and did not condone them.

He stated that the company would retain independent securities counsel and vowed to take the matter to the SEC, characterizing Robinhood's tokens as an unregistered securities product that undermines the regular relationship between a public company and its shareholders.

The market reaction was fast and telling: AMC shares rose as much as 21% in overnight trading after the public dispute broke out.

Robinhood did not back down. In the days that followed, the company's chief legal officer, Dan Gallagher, a former SEC commissioner, mocked the tone of Aron's complaint on social media, saying Robinhood "know[s] a little something about the US securities laws," and inviting AMC's lawyers to contact them. CEO Vlad Tenev originally commented on X with a brief "What's the concern?" before making his first extensive, broadcast comments on the controversy in a CNBC "Squawk Box" interview on September 9.

Tenev contended that a public company owns the rights and obligations associated with its own shares, but not the securities created by other companies that simply reference those shares. In his words, issuers "don't control everything," therefore shouldn't be required to assent to products like Robinhood's tokens.

A Broader Notion About Modernizing Markets

Aside from the AMC dispute, Tenev has posted a broader defense of tokenization as a concept, arguing that traditional market infrastructure, with its fixed trading hours, closed networks, and multiple layers of proxies, wasn't designed for a world of constant trading, self-custody, and composability. He has already urged US regulators to modify laws governing tokenized stocks so that American markets don't fall behind other countries experimenting with the technology.