Robinhood CEO Vlad Tenev will reportedly testify before the US House Committee over its involvement with Gamestop. The regulators are interested in the details of the GameStop short squeeze so let’s find out more in today’s cryptocurrency news.
The Robinhood CEO Vlad Tenev will likely soon testify before the US House Financial Services Committee according to a report by the American political publication Politico which said Tenev is expected to take part in the hearing headed by Representative Maxine Waters due to the app’s involvement with purchasing of Gamestop’s GME shares.
Waters announced the plans of the Financial Services Committee to hold a hearing regarding Gamestop on February 18 entitled “GameStopped? Who Wins and Loses When Short Sellers, Social Media, And Retail Investors Collide” and the hearing will be mostly focused on market volatility as well as issues surrounding GameStop and other stocks:
“I am concerned about whether or not Robinhood restricted the trading because there was collusion between Robinhood and some of the hedge funds that were involved with this.”
The announcement didn’t quite explain more and didn’t even say what witnesses will take part in the hearing as Robinhood hasn’t announced the participation so far. Some US regulators already drew attention to the platform’s handling of the short squeeze as the US SEC hinted that it was looking at issues with GameStop that Robinhood had expressing more concerns over the high price volatility of certain stocks’ trading pairs.
Robinhood’s GameStop saga started at the end of January when the company stopped buying for GameStop stocks as well as other shares that were “pumped” through the r/Wallstreetbets Reddit group. Robinhood restricted trading for about 50 stocks on Friday before narrowing the restrictions to eight stocks but users reported that they are still limited to buying even one more share.
Tenev discussed the company’s moves to restrict trading while he was talking to Elon Musk on the audio chat app Clubhouse. Tenev explained that the restricting decisions were made by a clearinghouse that was based on capital requirements. He denied allegations that Citadel Securities, the popular trading company, pushed the company to impose such limits. As reported previously, The SEC Will review Robinhood’s actions that were taken against Gamestop and the trading of its stocks on its platform.
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