Robinhood Suspends Stock Trading Due to ‘Volatility’

Share Article
In Brief
  • Robinhood has halted trading on stocks related to the subreddit Wall Street Bets.

  • Traders can only close their positions, no further buying is allowed.

  • There is outrage from the community as Robinhood claims “Volatility.”

  • promo

    Free Cloud Mining Providers to Mine Bitcoin in 2021

The Trust Project is an international consortium of news organizations building standards of transparency.

Several stockbrokers, including Robinhood, have announced the suspension of trading for several stocks following unprecedented volume and irregular pricing.

Sponsored



Sponsored

Popular stockbroker Robinhood has stated on its platform that the buying of several stocks, including GameStop (GME), Nokia (NOK), and AMC Entertainment (AMC), among others, will not be tradable due to market volatility

Robinhood goes on to explain that “we are restricting transactions for certain securities to position closing only.” 

Sponsored



Sponsored

Robinhood Robs the Hood

Several other stockbrokers have taken similar stances to halt trading. The move has received backlash from the Wall Street Bets and cryptocurrency community. 

The unprecedented move received negative applause from several key members of the cryptocurrency fraternity. Gemini co-founders Cameron and Tyler Winkelvoss also had something to say.

Monero founder Riccardo Spagni also commented on the news. Spagni stated that:

“retail is destroying the underlying assumptions made by institutional investors, so now the trade platforms are trying to prevent retail from trading.”

Public Outcry

The news has seen traders across the stock and cryptocurrency markets call foul play. The decision to halt trading is not something a broker does on a whim. 

This week has been a remarkable week for the stock market. Small stocks have seen dramatic price increases. None so much as the American video game, consumer electronics, and gaming merchandise retailer GameStop (GME). 

GameStop’s share price has risen by 2,000% since the beginning of January. All thanks to a previously little-known Reddit group called Wall Street Bets. The group of forum members has caused a surge in GME, squeezing short-sellers of the stock.

In doing so, they inflicted losses on investment management firms. One particular firm, Melvin Capital, took huge losses on the stock. Pundits believe Melvin had the biggest short position on GME. 

Melvin Capital exited its short position earlier this week. But that hasn’t stopped the momentous climb. GME reached over $400 before the suspended trading announcement. 

No Paused Trading On Binance

The move reiterates the importance of decentralization within the markets. Binance CEO Changpeng Zhao reiterated that Binance “won’t be able to ban it or pause trading” following a similar surge in dogecoin price action.

The meme digital asset is available on Robinhood. Perhaps this is one of the reasons the memecoin has become so popular. 

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
Sponsored
Share Article

Ryan is a Fintech specialist with a passion for cryptocurrencies and blockchain adoption. A keen trader and investor in the market since 2016, he enjoys keeping up to date with the latest developments within the industry while finding the next 100x altcoin.

Follow Author

Crypto predictions with the Best Telegram Signal with +70% accuracy!

Join now

Free Cloud Mining Providers to Mine Bitcoin in 2021

Go

How To Mine Cryptocurrency: Beginner’s Guide

Let's Go