'The chain is now earnings': Bernstein sees 31% upside for Robinhood as fees top Solana, BNB Chain

Analysts at research and brokerage firm Bernstein maintained an Outperform rating and $160 price target on Robinhood Markets, saying its new Layer-2 network has quickly become a source of earnings for the company.

Robinhood shares fell 2.09% on Friday to close at $122.11, according to The Block's HOOD price page. U.S. markets were closed on Monday for public holiday. Bernstein's price target implies approximately 31% upside from that price level.

In a Tuesday note to clients, the Bernstein analysts led by Gautam Chhugani pointed to Robinhood Chain's rapid growth since its July 1 launch. The network has already accumulated about $1.5 billion in TVL and more than $50 billion in DEX volume.

"The chain is now earnings," the analysts wrote, saying the network's trading fees are tracking at $2 million to $4 million a day. The network ranked first among all chains over the past 15 days with about $33 million in fees — ahead of Solana at about $11 million and BNB Chain at about $9 million.

Robinhood keeps about 90% of those fees, according to the note. About 10% goes to Arbitrum, which provides the technology, while less than 1% is paid to Ethereum for data fees.

Bernstein also said the value of tokenized stocks on Robinhood Chain has climbed from about $10 million to $140 million over the last two months. The network accounted for roughly 32% of tokenized-equity transfer value in the week of Aug. 30, behind only BNB Chain.

Meanwhile, total stablecoin supply on Robinhood Chain reached about $1 billion, up from roughly $241 million in early July, the analysts said. USDG made up about 66% of the total on Robinhood Chain, while USDe accounted for another 33%.