Republican and Democratic lawmakers want answers on the reasons of why Robinhood prevented their investors from purchasing stocks on its platform early on Thursday. Rep. Alexandria Ocasio-Cortez and Sen. Ted Cruz are among the voices urging congressional action to figure out why Robinhood interfered with its users’ ability to buy some stocks which include GameStop, AMC Entertainment, and BlackBerry, among others.
The restriction came after a large mass of users worked together through calls on social media sites such as Reddit and Discord. GameStop’s stock, for example, began the month below $20 per share, but closed above $300 per share on Wednesday night.
Sen. Ted Cruz, R-Texas, told reporters lawmakers needed answers “to why they halted the trading.”
“It seems to favor a handful of rich influential players at the expense of ordinary citizens and ordinary traders,” Cruz said.
Early on Thursday, Robinhood and Interactive Brokers restricted buying shares in GameStop and several other stocks that soared after being shorted by professionals. Thursday evening, Robinhood said it will only allow limited buying on Friday.
Rep. Ocasio-Cortez tweeted the restriction was “unacceptable,” adding Congress needed to know more about the move “to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit.”
Sen. Ted Cruz took to Twitter retweeting Ocasio-Cortez with scarce words of agreement, writing “Fully agree.”
Reddit and Robinhood both became the top two apps listed in Apple’s App Store on Thursday because of their increase in user growth, with a large portion of their users investing in the stocks driven higher by social media users.
U.S. Representative Rashida Tlaib, urged on Twitter that Congress “have a hearing on Robinhood’s market manipulation.
Sources: ABC, Washington Examiner, Fox News, Forbes, and Reuters; Photo: nytimes.com