Robinhood removes trading restrictions on meme stocks
Robinhood freely usable again. (Image: OpturaDesign / Shutterstock.com)
No time right now?
The online broker Robinhood came under harsh criticism for its trading restrictions on small stocks, including Gamestop and AMC. Now Robinhood has lifted all restrictions.
On Thursday last week, online broker Robinhood and some of its competitors put drastic trading restrictions in place on stocks. For some papers, including Gamestop, Robinhood, among others, had completely suspended trading.
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Trade restrictions provoke criticism in many places
This led to an outcry within the app’s users and, in addition to prominent politicians, also called on judicial bodies such as the Texas Attorney General.
In a clubhouse chat, Robinhood boss Vlad Tenov spoke to Elon Musk a few days ago about the background to the trade ban. This story has the potential to keep judicial bodies busy. There is suspicion that a clearing house could have made a completely excessive security requirement in order to achieve a certain success, presumably the trade restrictions. Meanwhile, Tenov tried to dispel this impression. Nice detail: Robinhood works with the clearing house of Citadel, one of the largest hedge funds in the country.
Robinhood lifts all restrictions – too late?
On Friday, Robinhood announced that it had lifted all restrictions on stock trading. Most recently, the purchase of Gamestop shares was still limited to 500, the purchase of AMC shares to 5,500. Unlimited purchases are now possible again.
To what extent this is still of interest is questionable. Because both Gamestop and AMC have soared behind them and are moving at a fast pace towards the level before the course rally. In the aftermath, it will certainly have to be dealt with legally whether the rapid price losses would also have occurred if trading had not been limited.
In any case, Robinhood initially went out of action unscathed. On Friday alone, the app was downloaded more than 600,000 times. That exceeds the previous record from last March by more than four times.
