Was stock trading app Robinhood the villain in the GameStop saga? “In a decentralized trading market, no one would have that power.”
Was last week’s Reddit versus Wall Street stand-off really the “beginning of the end for centralized finance,” as Gemini founder Tyler Winklevoss described it? Or was it just a one-time instance of individuals coming together to right a perceived wrong — with no long-term economic consequences?
As GameStop, a struggling videogame retailer, came under attack by hedge-fund short sellers, a coalition of individuals spearheaded by r/Wallstreetbets, a Reddit forum, jumped in to save GameStop by buying its shares, driving its stock price from $20 to as high as $483 — and doing some real damage to short traders in the bargain.
But then Robinhood, the insurgents’ trading platform of choice, suspended purchases of GameStop’s GME stock and seven other stocks.