Rumors are coming out about what happened today. The events sound fishy. Employees at Robinhood are saying the company CEO was receiving calls from the White House pressuring them to restrict trading on GME and AMC.
Is Robinhood restricting free trade because big firms told them to do it?
Not only Robinhood but other stock trading services blocked or are still blocking users from buying GameStop stock. Meanwhile, Citadel, a $35B dollars hedge fund, has or had massive short positions in GameStop.
An investigation into trading platforms that are blocking users from buying the stock FOR NO REASON must happen. Hedge funds have manipulated stock markets for a long time with massive sums of money. However, today’s events were more blatant than ever.
— King Bach (@KingBach) January 28, 2021
People buy and trust stocks because they think it is a free market. If this event goes unchecked, it may be hard to call our market free market anymore.
Are our apps rigged?
Check out what some Robinhood users think of the app:
This afternoon Robinhood released the following statement:
|“An update on market conditions|
It’s been a tough day, and we’re grateful to you for being a Robinhood customer. In light of the extraordinary market conditions this week, we temporarily limited buying for certain securities this morning. Starting tomorrow, we plan to allow limited buys of these securities. We’ll continue to monitor the situation and may make adjustments as needed. This was a temporary decision made to best continue serving you, and was not an easy one to make. We know it’s led to frustration and confusion, and wanted to provide some clarity. As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits. Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today. To be clear, this decision was not made on the direction of any market maker we route to or other market participants. The past year in particular has shown us that the financial markets are for everyone—not just institutional investors and hedge funds. We’ve seen a new generation enter the market, and they’re sparking conversations about what it means to be an investor. We stand in support of you, our customers. Democratizing finance for all means giving more people access, not less. We’ll keep monitoring market conditions and will update this Help Center article with the latest changes. We also published a blog post regarding today’s events. Thank you again for being a Robinhood customer. We’re so grateful for your support.“
The statement sounds like they don’t realize they are about to go out of business. The statement also sounds like they didn’t answer anyone’s questions or address any concerns.