Robinhood President and COO Jim Swartwoth said in an internal chat, "you wouldn't believe the convo we had with Citadel, total mess." The GameStop short squeeze story is headed to the big screen in 2023. [30], Later analysis by a cyber security company of social media posts suggested that thousands of automated bots may have hyped GameStop stock, Dogecoin, and other stocks, on social media. #DeleteRobinhood", "Elon Musk lashes out at short sellers during GameStop market war", "Ja Rule, a Robinhood User Since 2014, Calls GameStop an 'Uprising', "Jon Stewart joins Twitter and defends the Redditors", "Jimmy Kimmel deletes tweet suggesting Jon Stewart sounded like Trump by backing GameStop traders", "Jimmy Kimmel Sparks Anger For Calling Reddit Investors 'Russian Disruptors', "Robinhood Hit With Class Action Suit for Muzzling GameStop Uprising", "Mark Cuban, Dave Portnoy, AOC and others react to Robinhood restricting trades on GameStop and AMC", "Wall Street may never be the same after GameStop saga", "Leon Cooperman on GameStop Reddit speculators: 'I'm not damning them' but it will 'end in tears', "Robinhood is getting trashed on Google Play", "Google Deletes 100,000 Negative Reviews of Robinhood App From Angry Users", "Robinhood plummets back down to a one-star rating on Google Play", "Protesters gather at Robinhood HQ, SEC, NYSE", "Angry customers show up at Robinhood's headquarters in the wake of GameStop trading chaos", "The GameStop Short Squeeze Shows an Ugly Side of the Investing World", "GameStop short-sellers Melvin Capital and Citron surrender their bearish bets after 700% rally drives huge losses", "Citron Research covered majority of GameStop short position in $90s/share", "Death Threats and Hate Force Hedge Funds to Step Up Security", "Robinhood and Citadel's relationship comes into focus as Washington vows to examine stock-market moves", "Robinhood Gets Almost Half Its Revenue in Controversial Bargain With High-Speed Traders", "GameStop Frenzy Puts Spotlight on Trading Giant Citadel Securities", "The Citadel Link: What Ken Griffin Has to Do With GameStop", "Robinhood, Citadel Win Dismissal of Meme-Stock Lawsuit", "Citadel Securities Says It Learned of Trading Curbs on Twitter", "Citadel Securities Faces New Pressure Over GameStop Frenzy", "Reddit rejoices as hedge-fund billionaire Ken Griffin fires back at those making #KenGriffinLied a trending topic on social media", "Court Filings Spark New Citadel-Robinhood GameStop Theories", "Here's what Robinhood executives allegedly said internally at the height of the GameStop short squeeze", "#CitadelScandal is trending on Twitter as retail traders express fresh outrage over allegations around meme-stock trading", "Netflix Finalizing GameStop Stock Movie Package; Mark Boal In Talks To Write, Noah Centineo Attached, Scott Galloway To Consult", "MGM Lands Rights To Ben Mezrich's Book Proposal 'The Antisocial Network'; Would Chronicle Recent Wall Street-GameStop Chaos", "Three GameStop movies are rushed into development. [20], On January 27, 2021, technology news website Mashable reported that the subreddit had broken pageview records due to the short squeeze, receiving 73 million pageviews in 24 hours. Dusaniwsky calculates that there continues to be moderate short covering in GameStop with short sellers covering 262,000 shares, worth $68 million, over the last 30 days but most of that. [99][100], According to a report by Bloomberg, Andrew Left, an activist short seller and head of Citron Research, had also shorted the stock and claimed to have closed the position as a total loss. [183], A Robinhood customer filed a class-action lawsuit against the company on January 28, 2021, for halting trading on GameStop. Apart from GameStop, many other heavily shorted securities (as well as securities with low short interest) saw increases in their prices: .mw-parser-output .citation{word-wrap:break-word}.mw-parser-output .citation:target{background-color:rgba(0,127,255,0.133)}a Prices may be higher during extended-hours trading. In which case my initial reaction is that it's awesome Reddit users and others are sticking it to hedge funds. [111] Three BlackBerry executives sold nearly $1.7 million of the company's stock, with one of the executives, Chief Financial Officer Steve Rai, selling all of his shares in the company excepting unvested employee stock options. [64][65], As of January 29, Robinhood was still imposing limits on the trading of GameStop, AMC, and Blackberry stocks. [57][58][59] Because there is a two-day lag between the moment when investors purchase a security and the moment cash and securities are actually exchanged, brokerage firms have to post collateral at clearing houses to guarantee the proper settlement of their clients' orders. It opened that day at $42.59 a share and closed at $65.01. This occurred shortly after a comment from Citron Research predicting the value of the stock would decrease. [150][151][152] Users of the subreddits r/CryptoCurrency and r/SatoshiStreetBets attempted to pump up Dogecoin to make it "the next GME/Bitcoin". [249] Citadel Securities is the sister company to Citadel LLC, which along with Point72 Asset Management invested $2.75 billion into Melvin Capital. [254], During the February 18 hearing held by the House Financial Services Committee, Citadel CEO Kenneth Griffin and Robinhood CEO Vlad Tenev faced questioning regarding their relationship and denied that the limits imposed on the trading of GameStop shares had been requested by Citadel. [85], On March 25, the stock rose 53 percent from its previous day's decline of 34 percent. The lawsuit alleges that a call was set up between Robinhood CEO Vlad Tenev, and a redacted person at Citadel Securities. [4][5][6], GameStop, an American chain of brick-and-mortar video game stores, had struggled in recent years due to competition from digital distribution services, as well as the economic effects of the COVID-19 pandemic, which reduced the number of people who shopped in-person. This can result in a cascade of stock purchases and an even bigger jump of the share price. [148][149], After brokerages halted the buying of GameStop and other securities, the price of several cryptocurrencies also began to increase substantially, with Dogecoin's value increasing over 800 percent. The same judge had previously dismissed a lawsuit alleging that there was collusion between brokerages and Citadel Securities. [12][28] According to Dow Jones market data, more than 175 million shares of GameStop were traded on January 25, the second largest total in a single day, surpassing its 30-day average volume of 29.8 million shares. A variety of politicians and commentators across the political spectrum made statements in support of those driving up the price of GameStop and other stocks, as well as against Robinhood and other companies' decision to limit these trades, including Representative Alexandria Ocasio-Cortez,[205] Senator Ted Cruz,[206] Representatives Ro Khanna,[207] Ted Lieu,[208] and Rashida Tlaib,[209] Fox Business host Charles Payne,[210] and conservative political commentators Rush Limbaugh,[211] Ben Shapiro,[212] and Donald Trump Jr.[213][214], Senator Elizabeth Warren criticized both the short sellers and the buyers, and argued that more regulation was needed. The unusually high price and volatility continued after the peak in late January. A group of angry Redditors have caused billions of dollars of damage to hedge funds shorting GameStop stocks. I expect the narrative to shift in the second half of the year when investors start looking for ways to play the console refresh and they begin to see what I see. [116] Similarly, an analysis by investment bank JP Morgan Chase suggested that institutional investors were heavily involved in the trading activity related to the short squeeze. [241] However, after another round of negative reviews on the app dropping it to a 1.1-star rating, Google confirmed that the new reviews do not violate Google policies and will not be removed. Last week it was trading at about $40 a share. [230] Comedian and television host Jon Stewart, after joining Twitter, expressed support for the Reddit traders in his first tweet, stating "they're joining a party Wall Street insiders have been enjoying for years". It notes that Swartwout then stated, "I have to say I am beyond disappointed in how this went down. GME Is GameStop's Short Squeeze Just Around The Corner? They're blocking the ability to trade to protect Wall St. hedge funds, stealing millions of dollars from their users to protect people who've used the stock market as a casino for decades", "Why Wall Street Is 'Losing Its Mind' Right Now", "Rush Limbaugh: GameStop saga mirrors politics as elites attempt to prevent regular people from benefiting", "Note: Robinhood absolutely should not be stopping trading of GameStop. [236][additional citation(s) needed], However, investor Michael Burry, who had acquired a 3.3-percent stake in GameStop in 2019, criticized the short squeeze, stating that "there should be legal and regulatory repercussions", and adding "this is unnatural, insane, and dangerous". [179][180] Representatives focused their attention on Robinhood's role in the event, asking Tenev why the brokerage had limited the trading of some securities and if it had clearly communicated its business model to its customers. This squeeze led to the share price reaching an all-time intraday high of US$483 on January 28, 2021 on the NYSE. The rally call was reportedly organized from r/bursabets, a Malaysian offshoot of r/wallstreetbets named after the Malaysian stock exchange. GameStop dropped 44% on Thursday, falling for the first time in six days as Robinhood and Interactive Brokers limited trading in several of the heavily shorted names to closing positions only,. [122], Many retail investors and r/wallstreetbets users bought shares of GameStop and other affected securities as they were reaching their peak prices or shortly afterwards. Veuillez slectionner le pays dans lequel vous faites vos achats. Main article: GameStop short squeeze On January 22, 2021, users of r/wallstreetbets initiated a short squeeze on GameStop, pushing their stock prices up significantly. [52] Webull halted buy orders for stocks affected by the squeeze,[53] but soon thereafter allowed orders to continue. This initially triggered a monstrous short squeeze. Tesla's . Then if we look at the third most recent 13F Form, which came out on March 31st, 2020 we can see they claim to be shorting 2,800,000 shares of Gamestop at $9,800,000 of Value, which means they shorted GME for $3.50 a share. (2023). Top Glove, Hartalega and Supermax respectively recorded increases in shares as high as 15 percent, 10 percent and 9.2 percent during intraday trading on January 29, before closing with respective increases of 8.5 percent, 5.4 percent and 3.7 percent. GameStop's rocket ship has come back to earth. [159] Users on r/wallstreetbets deny involvement in the increasing price of silver, instead blaming the increase on institutions and hedge funds with positions in silver, such as Citadel, seeking to offset losses on GameStop. [252][253] As Robinhood restricted trading of GameStop shares, users alleged that Citadel Securities directed Robinhood to do so. [17][18][19] Gill, a 34-year-old marketing professional and Chartered Financial Analyst (CFA) from Massachusetts, stated that he began investing in GameStop during the summer of 2019, after believing the stock to be undervalued. [22], Suggested factors included anger of some investors towards Wall Street hedge funds for their role in the financial crisis of 2007 and 2008,[23][18][24] or the general democratization of the stock market coupled with the ability of retail traders to communicate instantaneously through social media. [41] The value of AMC Networks (ticker symbol: AMCX) also increased significantly, which was believed to have happened because of the stock's name being similar to AMC's. [86][87], Short sellers who had bet against GameStop suffered large losses as a result of the short squeeze. Here's how they end", "Reddit's WallStreetBets Founder Sells Life Story to Movie Producer RatPac Entertainment", "GameStop and WallStreetBets Documentary in the Works From XTR and The Optimist", "Gaming Wall Street Trailer Examines Gamestop's 2021 Stock Phenomenon", "Review: Talking-head documentary 'Gamestop: Rise of the Players' focuses on the little guys", https://en.wikipedia.org/w/index.php?title=GameStop_short_squeeze&oldid=1150240747. [55] Some users alleged that Robinhood was selling shares without consent; Robinhood denied these allegations. Dozens of class action lawsuits have been filed against Robinhood in U.S. courts, and the U.S. House Committee on Financial Services held a congressional hearing on the incident. [9] In a CNBC interview, billionaire investor and hedge fund manager Leon Cooperman angrily criticized the Reddit users' market behavior, calling it a result of the federal response to the pandemic and stating that it would "end in tears" for the retail investors. "[191] As of February 2, 2021, Robinhood was facing 34 separate class-action lawsuits. U.S. House Committee on Financial Services, Economic impact of the COVID-19 pandemic in the United States, settle a member's outstanding transactions, The Church of Jesus Christ of Latter-day Saints, Keith Patrick Gill's Opening Statement Before the U.S. House Committee on Financial Services, United States District Court for the Southern District of New York, United States House Committee on Financial Services, Massachusetts Secretary of the Commonwealth, "How you could lose everything by short-selling stocks, whether it's betting against GameStop or Tesla", "GameStop: how Reddit amateurs took aim at Wall Street's short-sellers", "Meme Stock Saga Officially Over? All of those years of High Frequency Traders front running retail traders, now speed and density of information and retail trading is giving the little guy an edge. Yea there's deep value, then there's deep fucking value. MeaningCloud is a Software as a Service product that enables users to embed text analytics and semantic processing in any application or system. [256][257] Internal Robinhood messages stemming from a class-action lawsuit, showed Robinhood executives "scrambled to talk to Citadel CEO Ken Griffin", on January 27, 2021, the day trading of GameStop and related stocks was temporally halted, according to VICE. GameStop's shares slumped by 40% in 25 minutes on Wednesday, after a few days of frenetic growth. [158] On January 28 and 29, the price of silver rose 10 percent. In 31st ACM Web Conference, Industry Track (WWW), Lyon, France (2022). [244], The Wall Street Journal reported that short seller and Citron Research editor Andrew Left was being targeted online, including an incident where Left's social media accounts were hacked to text his children "threatening, profane and personal language". They also questioned whether Robinhood was encouraging its customers to take excessive risks in order to generate a profit and whether it had the appropriate infrastructure and funding to handle influxes of new clients. One of the largest short sellers in the GameStop trade, Melvin Capital, was forced to close its position in GME in January 2021 due to GameStop's soaring valuation. [160][161][162][163], On January 27, 2021, White House press secretary Jen Psaki said that Treasury Secretary Janet Yellen and others in the Biden administration were monitoring the situation. [35] A brief, sharp rise in the share price to over $200 followed Musk's tweet. [168] Senator Sherrod Brown announced that the Senate Banking Committee would hold a hearing on the state of the stock market and the alleged market manipulation surrounding the GameStop short squeeze. I'll post the update tomorrow as I always do after data readouts. 8 min read . [39] However, users quickly formed similar servers on the application,[39] and Discord reversed its decision the next day, attempting to help the community moderate its server instead. Other co-owners of the Charlotte Hornets with Jordan also experienced heavy losses due to short positions on GameStop, being forced into tens of billions of dollars of debt as a result. [267], Gains by existing shareholders and third parties, Alleged conflict of interest between Robinhood and Citadel. Move Over, GameStop", "After GameStop-like surge, Rocket stock frenzy shows signs of subsiding", "GameStop frenzy takes cryptocurrency market over $1 trillion", "Reddit frenzy pumps up Dogecoin, a cryptocurrency started as a joke, by over 800%", "The GameStop stonk bubble has swallowed DogeCoin, Frankie Muniz", "Bitcoin spikes 20% after Elon Musk adds #bitcoin to his Twitter bio", "Robinhood restricts crypto trading as Dogecoin soars 300 percent", "Silver futures jump 7% as Reddit traders try their squeeze play with the metal", "Silver Is the Latest Market Hit by Reddit Day-Trader Frenzy", "Silver hits eight-year high, but who's behind the buying? His net worth, as reported by Forbes, had declined by $500 million from its peak of $2.1 billion in 2019. This leads to a sharp rise in demand for the share, and huge rally . [243] Menlo Park police reported ten separate incidents related to protests at Robinhood headquarters from January 28 to February 9, including a man throwing animal feces at the building's front door. "[260], In February 2021, Deadline Hollywood reported on Netflix's plans to develop a movie based on the events, with Mark Boal in negotiations to write and Noah Centineo set to star in the film. being halted at least once as the price fell by double-digit percentages. [107] On February 1, GameStop short interest fell to 39 percent of free-floating shares, from 114 percent in mid-January, according to IHS Markit. The practice carries an unlimited risk of losses, because there is no inherent limit to how high a stock's price can rise. [97][98] Melvin ultimately shut down on May 18, 2022. The suit alleges Gill misrepresented himself as an amateur investor to inflate the stock price. [88], By January 28, 2021, Melvin Capital, an investment fund that heavily shorted GameStop, had lost 30 percent of its value since the start of 2021, and by the end of January had suffered a loss of 53 percent of its investments. [266] The documentary GameStop: Rise of the Players interviewed several of the r/wallstreetbets users and was released on January 28, 2022. Many traders were furious, and called for class-action lawsuits in multiple popular Reddit posts. Meanwhile, apes remain confident that the stock can go. Hence, the initial short squeeze triggered a gamma squeeze and pushed GameStop stock to highs of $325. Robinhood denied these allegations for class-action lawsuits called for class-action lawsuits in multiple popular Reddit posts stock decrease. Many traders were furious, and called for class-action lawsuits in multiple popular Reddit posts ] as Robinhood restricted of... Rise in demand for the share price to over $ 200 followed Musk 's tweet percent from previous! 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