{"id":113462,"date":"2021-02-19T00:44:19","date_gmt":"2021-02-19T00:44:19","guid":{"rendered":"https:\/\/precoinnews.com\/?p=113462"},"modified":"2021-02-19T00:44:19","modified_gmt":"2021-02-19T00:44:19","slug":"robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/","title":{"rendered":"Robinhood, hedge fund chiefs face irate questions at GameStop hearing"},"content":{"rendered":"

WASHINGTON (Reuters) – The head of trading app Robinhood and Wall Street hedge fund managers on Thursday fielded a barrage of questions in the U.S. Congress about their role in the GameStop trading frenzy, at times being cut off by irate lawmakers who found their answers wanting.<\/p>\n

Financial heavyweights including billionaire Republican mega-donor and Citadel CEO Ken Griffin defended their businesses at the hearing, which lasted more than five hours. Lawmakers probed how Reddit users trading on retail platforms squeezed hedge funds that had bet against shares of the video game retailer and other companies.<\/p>\n

\u201cRobinhood owns what happened and we need to make sure it doesn\u2019t happen again,\u201d said Robinhood CEO Vlad\u202f Tenev, who appeared to field the most questions.<\/p>\n

Robinhood and other trading apps drew fire for putting trading limits on GameStop a day after the stock price more than doubled. The trading platforms, who face numerous lawsuits, said the limits were needed because the massive volatility prompted clearing houses that guarantee trades to call for billions of dollars in extra collateral.<\/p>\n

But outraged lawmakers questioned if the platforms were siding with hedge funds over retail investors.<\/p>\n

Representative Sean Casten, an Illinois Democrat, played an automated message on the Robinhood customer service phone line while questioning Tenev about how customers are treated.<\/p>\n

Griffin got numerous questions which focused on his company\u2019s heft. Melvin Capital CEO Gabriel \u202fPlotkin and Reddit CEO Steve Huffman also appeared.<\/p>\n

Keith Gill, a Reddit user and YouTube streamer known as Roaring Kitty, sat in a red videogaming chair from which he recorded many videos promoting his investment in GameStop. Displayed behind him was a poster of a kitten with the caption \u201cHang in there!\u201d Many investors who bought GameStop as the price skyrocketed now face deep losses.<\/p>\n

\u201cA few things I am not. I am not a cat. I am not an institutional investor, nor am I a hedge fund,\u201d Gill said. He told lawmakers he was still enthusiastic about the stock.<\/p>\n

Related Coverage<\/p>\n<\/p>\n

See more stories<\/svg><\/p>\n

\u201cI am just an individual whose investment in GameStop and posts on social media were based upon my own research and analysis,\u201d he said.<\/p>\n

Representative Maxine Waters, chair of the Democratic-led House finance panel, is a critic of Wall Street, while Republicans on the panel also sought to burnish their consumer-protection credentials, making for a fiery virtual hearing featuring echoes, feedback and background noise.<\/p>\n

Waters, who in January called hedge funds \u201cunethical,\u201d frequently talked over Tenev and Griffin and cut them off. At the end, she vowed to hold more hearings, with testimony from regulators at the Securities and Exchange Commission and the Financial Industry Regulatory Authority.<\/p>\n

She said she was \u201cmore concerned than ever\u201d that retail investors were being taken advantage of, and that large market makers like Citadel could pose a threat to the financial system.<\/p>\n

In prepared opening testimony, the witnesses generally acknowledged the GameStop saga was unprecedented, but they all said there was no foul play on their part.<\/p>\n

Graphic: GameStop’s rise and fall GameStop’s rise and fall –<\/p>\n

Graphic: GameStop comments soared on Reddit’s Wallstreetbets –<\/p>

FILE PHOTO: GameStop logo is seen in front of displayed Reddit logo in this illustration taken February 2, 2021. REUTERS\/Dado Ruvic\/Illustration\/File Photo\/File Photo<\/figcaption>

Tenev expressed regret that Robinhood\u2019s actions upset customers but said no hedge funds influenced its decision and the situation would have been \u201csignificantly worse\u201d if it had not suspended buying.<\/p>\n

\u201cI\u2019m sorry for what happened. I apologize. I\u2019m not going to say that Robinhood did everything perfect,\u201d he said.<\/p>\n

New York-based hedge fund Melvin Capital, which had bet GameStop\u2019s shares would tumble, suffered massive losses as the stock soared leading up to Jan. 28. Citadel made a $2 billion investment in Melvin on Jan. 25.<\/p>\n

Lawmakers quizzed Robinhood\u2019s commercial arrangements with market makers to which it routes orders, as well as whether that \u201cpayment for order flow\u201d model hurts customers.<\/p>\n

Griffin, majority owner of Citadel Securities, a Robinhood market maker, was castigated by Democratic Representative Brad Sherman for evading his question about whether market-makers provide the same prices to all brokers.<\/p>\n

Griffin maintained Citadel Securities, which executes roughly 47% of all U.S.-listed retail volume, had worked for years to help give consumers \u201ca better price.\u201d<\/p>\n

All parties have denied any attempt by Citadel or Citadel Securities to influence Robinhood\u2019s policies.<\/p>\n

MANIPULATION<\/h2>\n

Gill and Huffman were asked about the role of social media platforms in potential market manipulation.<\/p>\n

\u201cWe spend a lot of time at Reddit ensuring the authenticity of our platform… And in this specific case, we did not see any signs of manipulation,\u201d Huffman told lawmakers.<\/p>\n

At times, Gill and Plotkin offered their competing investment theses on GameStop, with Plotkin arguing that due to the rise of digital downloads, the video game bricks-and-mortar business model has \u201cstructural challenges.\u201d<\/p>\n

Source: Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

WASHINGTON (Reuters) – The head of trading<\/p>\n","protected":false},"author":3,"featured_media":113461,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23054],"tags":[],"yoast_head":"\nRobinhood, hedge fund chiefs face irate questions at GameStop hearing - Pre Coin News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Robinhood, hedge fund chiefs face irate questions at GameStop hearing - Pre Coin News\" \/>\n<meta property=\"og:description\" content=\"WASHINGTON (Reuters) – The head of trading\" \/>\n<meta property=\"og:url\" content=\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/\" \/>\n<meta property=\"og:site_name\" content=\"Pre Coin News\" \/>\n<meta property=\"article:published_time\" content=\"2021-02-19T00:44:19+00:00\" \/>\n<meta name=\"author\" content=\"mediabest\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:image\" content=\"https:\/\/precoinnews.com\/wp-content\/uploads\/2021\/02\/cnewsfotor-17.jpg\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"mediabest\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/\",\"url\":\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/\",\"name\":\"Robinhood, hedge fund chiefs face irate questions at GameStop hearing - Pre Coin News\",\"isPartOf\":{\"@id\":\"https:\/\/precoinnews.com\/#website\"},\"datePublished\":\"2021-02-19T00:44:19+00:00\",\"dateModified\":\"2021-02-19T00:44:19+00:00\",\"author\":{\"@id\":\"https:\/\/precoinnews.com\/#\/schema\/person\/ad0e9920e03d3b41c7ad02a18375d76a\"},\"breadcrumb\":{\"@id\":\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/precoinnews.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Markets\",\"item\":\"https:\/\/precoinnews.com\/category\/markets\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Robinhood, hedge fund chiefs face irate questions at GameStop hearing\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/precoinnews.com\/#website\",\"url\":\"https:\/\/precoinnews.com\/\",\"name\":\"Pre Coin News\",\"description\":\"precoinnews.com\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/precoinnews.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/precoinnews.com\/#\/schema\/person\/ad0e9920e03d3b41c7ad02a18375d76a\",\"name\":\"mediabest\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/precoinnews.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/f5f13cb3b94fc348d515c0951f6ca073?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/f5f13cb3b94fc348d515c0951f6ca073?s=96&d=mm&r=g\",\"caption\":\"mediabest\"}}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Robinhood, hedge fund chiefs face irate questions at GameStop hearing - Pre Coin News","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/","og_locale":"en_US","og_type":"article","og_title":"Robinhood, hedge fund chiefs face irate questions at GameStop hearing - Pre Coin News","og_description":"WASHINGTON (Reuters) – The head of trading","og_url":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/","og_site_name":"Pre Coin News","article_published_time":"2021-02-19T00:44:19+00:00","author":"mediabest","twitter_card":"summary_large_image","twitter_image":"https:\/\/precoinnews.com\/wp-content\/uploads\/2021\/02\/cnewsfotor-17.jpg","twitter_misc":{"Written by":"mediabest","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/","url":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/","name":"Robinhood, hedge fund chiefs face irate questions at GameStop hearing - Pre Coin News","isPartOf":{"@id":"https:\/\/precoinnews.com\/#website"},"datePublished":"2021-02-19T00:44:19+00:00","dateModified":"2021-02-19T00:44:19+00:00","author":{"@id":"https:\/\/precoinnews.com\/#\/schema\/person\/ad0e9920e03d3b41c7ad02a18375d76a"},"breadcrumb":{"@id":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/precoinnews.com\/markets\/robinhood-hedge-fund-chiefs-face-irate-questions-at-gamestop-hearing\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/precoinnews.com\/"},{"@type":"ListItem","position":2,"name":"Markets","item":"https:\/\/precoinnews.com\/category\/markets\/"},{"@type":"ListItem","position":3,"name":"Robinhood, hedge fund chiefs face irate questions at GameStop hearing"}]},{"@type":"WebSite","@id":"https:\/\/precoinnews.com\/#website","url":"https:\/\/precoinnews.com\/","name":"Pre Coin News","description":"precoinnews.com","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/precoinnews.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/precoinnews.com\/#\/schema\/person\/ad0e9920e03d3b41c7ad02a18375d76a","name":"mediabest","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/precoinnews.com\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/f5f13cb3b94fc348d515c0951f6ca073?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/f5f13cb3b94fc348d515c0951f6ca073?s=96&d=mm&r=g","caption":"mediabest"}}]}},"_links":{"self":[{"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/posts\/113462"}],"collection":[{"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/comments?post=113462"}],"version-history":[{"count":0,"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/posts\/113462\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/media\/113461"}],"wp:attachment":[{"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/media?parent=113462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/categories?post=113462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/precoinnews.com\/wp-json\/wp\/v2\/tags?post=113462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}