Berlin Trade Republic asks for forgiveness
No time right now?
The operators of the broker app Trade Republic apologized to their users in an email to their customers. The startup said self-critically, expectations were disappointed.
On Thursday last week, in what appeared to be a concerted action, many online brokers decided to either suspend or at least limit trading in extremely volatile assets such as the Gamestop share. In addition to politicians, this has also brought prosecutors to the scene.
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Legal aftermath is being prepared
The accusation of anti-competitive agreements – also involving the severely damaged hedge funds – is in the room. The Texas state attorney’s office even said it “stinks of corruption”.
Both houses of the US Congress have announced hearings. The new US Treasury Secretary Janet Yellen has for Thursday according to the Wall Street Journal convened a meeting with the top US financial regulators.
Trade Republic is contrite
The Berlin startup Trade Republic apparently no longer wants to be involved in these developments. “We have disappointed the expectations of a modern, democratic and free broker,” said the broker. The problem was that the connected trading platform “Lang & Schwarz Exchange” had failed due to database overload and “several thousand orders per minute” should have been processed at the same time. Overall, they “did not do a good job.”
Nevertheless, the decision not to accept any more purchases for six shares was only made to ensure the stability of the systems. According to this, there should have been no increased deposit claims from clearing houses – as with the US competitor Robinhood. Hedge funds would not have tried to influence the decision either.
It is not the provider’s first apology in the case, but compared to the first statement it is probably the more honest one.
According to the company, trading is now back to normal. However, this is not a particularly worthy achievement, because the Gamestop share has been going downhill again for a few days. The share fell on Tuesday by 56 percent and fell on Wednesday at times by 32 percent and down to 60.50 euros. In the meantime it has recovered and stands at 90 euros when this article is published.
