Crypto's Value Capture Problem & Why Robinhood Built Its Own Blockchain

Inversion Capital spent eight months evaluating more than 20 sectors to test whether acquiring a traditional business and applying crypto could generate above-market returns. The firm deprioritized MVNOs after finding terrible unit economics, high churn, and insufficient cash flow. The original MVNO thesis was built around bundling telecom and fintech inspired by Mpesa and stablecoin demand in Latin America, but MVNOs rent rather than own infrastructure, making the bundling logic hard to underwrite. Credit was also deprioritized because true on-chain B2B borrowing rates run 8 to 12 percent rather than the 2 to 5 percent visible on protocols like Aave, and on-chain capital markets work mostly for crypto-backed loans while becoming significantly more complex for any other collateral type.

The team came out bearish on remittance companies after extensive work in the sector. Western Union carries compressed multiples and declining fundamentals, Remitly and Wise face compressed unit economics on certain corridors, and stablecoins plus players like Felix Pagos are adding further competitive pressure. The core finding was that fixing remittance is not a technology problem but a stakeholder incentive problem, because stablecoin technology can already move money in real time while stakeholder resistance makes adoption a hard sell.

A recurring structural problem was that filtering for businesses where crypto could release value led toward businesses that were not great to begin with. The broader pattern is that transformation by technology tends to benefit new entrants rather than incumbents, the same way media transformation benefited TikTok and Facebook rather than newspapers. An RFP run for a large multinational industrial company found most crypto aggregators quoted above mid-market by 20 to 50 basis points, and the FX problem in exotic corridors like Colombia, Egypt, and Israel was identified as a liquidity problem rather than a technology problem. Santiago argued that open source networks push value away from companies and onto consumers as surplus, and that any Stripe customer can implement stablecoins overnight, making crypto a table-stakes feature rather than a competitive differentiator. The value accrual question in crypto remains unresolved, including whether Stripe's Tempo product will be a profit center or merely benefit Stripe equity.

Inversion broadened its mandate in response, moving toward buying good businesses where technology including AI or crypto is orthogonal to value creation rather than the primary thesis. The firm is modeling itself after Berkshire Hathaway and Constellation Software. Mark Leonard started Constellation with 25 million Canadian dollars in 1995 and built it into a business worth over 500 billion dollars through many acquisitions in the two to four million dollar range. Santiago argued the holding company model is superior to the fund model because funds are locked into a mandate to invest in crypto even when the thesis weakens, and noted that crypto fund managers privately admit they want to invest in other areas like robotics and AI.

Robinhood Chain generated over 500 million dollars in volume on Uniswap, more than any other chain except Ethereum mainnet, and approximately 150,000 new active wallets appeared in a single day with volume growing 10x day over day. The rationale for Robinhood launching its own chain is to verticalize the stack, gain more control, and improve margins, with users already going on-chain to other platforms representing revenue left on the table. Moving assets on-chain also allows listing any asset available on DEXes like Uniswap or Jupiter, bypassing traditional compliance gatekeeping that creates internal conflict between listing teams and compliance teams. One speaker questioned whether the chain offers real efficiency gains over Robinhood's existing database, noting it introduces more surface area for failure and may function little differently from a database with some Ethereum security attached if operated by a single sequencer. Speakers described an all-out war between Coinbase, Robinhood, and Kraken to become the dominant platform as trading moves on-chain. Coinbase was described as having made strategic missteps by pushing into creators rather than capital markets, a course it has since corrected. Robinhood's user base skews toward retail speculators while Coinbase's more conservative base holds large unrealized Bitcoin and ETH gains, making Base stronger for borrow-lend protocols like Morpho.

On dual token and equity structures, speakers identified three camps: one finding dual structures acceptable given regulatory necessity, one arguing tokens and equity can coexist if clearly disclosed since traditional capital markets already have many instrument types, and one holding that a single instrument should drive company value and anything that does not look like a true token will be discounted. True tokens like Ethereum, Solana, and Hyperliquid set a benchmark that makes dual-structure projects face an uphill battle, and the market has already spoken negatively on tokens that do not resemble pure tokens regardless of structural intent. Speakers acknowledged that dual structures reflect ongoing regulatory uncertainty rather than founder preference.