The stock-trading platform Robinhood and other Wall Street brokers are coming under fire after blocking users from buying GameStop and other stocks that have become a target for the Reddit community r/WallStreetBets -- even uniting two figures from far ends of the political spectrum and a rapper in opposition to the move.
Users on the financial message board came together to place a large number of buys on the gaming retail outlet and a handful of other stocks in response to short-sellers, seeking to push them out of their positions. That caused shares of GameStop's stock (GME) to soar in the past week, leading to a reaction from some online sellers. The price had risen more than 1,600 percent since January 12, Fox Business reported.
As Fox Business noted, the Robinhood trading app and online broker Interactive Brokers both moved to restrict trading in a number of commodities, only allowing users to sell their existing holdings of AMC Entertainment Holdings, BlackBerry Ltd., Bed Bath & Beyond Inc., Express Inc., GameStop Corp., Koss Corp., Naked Brand Group and Nokia Corp.The move came under sharp scrutiny, especially the lack of explanation from Robinhood. Alex Fitzpatrick, a senior editor at Time, noted the app made no attempt to offer a justification for the restriction.
"Robinhood's blog post about restricting GME and other stocks offers exactly zero justification for that action. That's a yikes from me," he tweeted.
Others joined in criticizing the restrictions. Barstool Sports founder Dave Portnoy wrote on Twitter that it appeared Robinhood and others restricting the sales were trying to "force a crash" by closing the market, writing the people behind the move should be in jail.
He and others were encouraging those who had purchased GME to hold onto their positions, noting that if they were to panic and sell, it could stymie the attempts to push the short-sellers out of their positions.
The actions of Robinhood and others to restrict sales was so widely condemned, it even united two very different political figures. In statements on Twitter, New York Congresswoman Alexandria Ocasio-Cortez and the eldest son of former President Donald Trump both spoke out against the company.
"Gotta admit it's really something to see Wall Streeters with a long history of treating our economy as a casino complain about a message board of posters also treating the market as a casino," she tweeted.
"It took less than a day for big tech, big government and the corporate media to spring into action and begin colluding to protect their hedge fund buddies on Wall Street. This is what a rigged system looks like, folks!" tweeted Donald Trump Jr.
They were joined by rapper Ja Rule, who also took to Twitter to call it a "f*cking crime" that Robinhood was preventing people from buying GME, advising them to hold the line and not sell.