Popular trading app Robinhood has limited users from trading GameStop Stock (GME) after it shook up the market. Individuals investors coordinated on social media and bought shares of struggling companies. It meant that they bet that these companies would do good regardless of their business condition. By doing so, they made hedge fund managers furious, who normally bet against those companies.
Video game retailers were hit hard by the pandemic after players had moved to online platforms to buy games. So economically, GME was not even an option for most investors. Yet, social media’s impact on the stock market was clearly visible to the whole world. Elon Musk had also played a huge role in attracting investors to GameStop Stock.
Robinhood trading app received huge criticism from wall street elites and government officials after watching GME laying waste to all the giants in its path. It stopped the trading but still faced criticism from average investors who were not happy. The app resumed the trading with restrictions but it did not seem to please many.
Social Media Sees Hypocrisy In Robinhood
Robinhood announced in a notification that users could close their position on GameStop stock but they were not allowed to buy any additional shares. Previously, it supported all sorts of trading hype even from Reddit or other social media. So, this time it raises concern regarding its U-turn due to the pressure from elites and the government. When big guys in the platform started to lose money, the app starved its little investors to save the big ones.
These two factors of capitalism have caused immense pain for so many average people in the world. Many and many have come to realize that the world has learnt nothing from The Great Recession, and there were so any damages to fix. Yet, the capitalistic entities carried on to exploit and manipulate markets in order to limit the growth of small and medium entities. This market manipulation goes unchecked and whenever average people are making money, limitations take place.
This shows that users must not get fooled by the name of this app because its not taking from the rich and giving to the poor. In fact, it might be a part of the same system that has extended the gap between rich and poor.
What Is Legal And Illegal Here?
According to the reports, the free-trading app might have faced a potential shortage of cash because it raised another 1 billion USD to its capital. Reports said that, this money came from existing investors only few hours after it stopped GME trading. The CEO of the company denied having any cash shortage.
Some lawmakers have also noticed that Robinhood was discriminating its own users by disabling people to freely trade GME. Whereas, hedge fund managers were able to freely trade whatever. It is alarming because more than half of the users on Robinhood own GameStop stock in some capacity. US lawmakers were ready to support any case against this behavior:
Trying To Stop The Flood Of Criticism
Reportedly, people started to send highly critical reviews on Robinhood’s Google Play store panel. It caused the app’s rating to fall down from 4 stars to 1 in a day. Then Google stepped in and removed over 100,000 critical comments from the play store. All of it seemed like a huge conspiracy in which all big guys have teamed up to curb the progress of average investors and keep benefitting elite investors.