The decision by security markets to restrict trading on stocks like GameStop sparked a rare moment of unity between conservatives and progressives on Capitol Hill Thursday.
Lawmakers from across the political spectrum — from the left-wing progressive House caucus known as "The Squad" to right-wing Senators who identify as "Constitutional conservatives" — skewered platforms like Robinhood and TD Ameritrade, accusing them of siding with Wall Street elitists instead of Middle-Class America.
Rep. Rashida Tlaib, D-Michigan, a progressive Democrat and member of "The Squad," called for House Democrats to investigate Robinhood's decision to halt trading on GameStop stock.
"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," Tlaib said.
This is beyond absurd. @FSCDems need to have a hearing on Robinhood's market manipulation. 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. https://t.co/CGkJxVfzkv
— Rashida Tlaib (@RashidaTlaib) January 28, 2021
Rep. Alexandria Ocasio-Cortez, D-New York, a fellow "Squad" member and a member of the House Financial Services Committee, said she would support an investigation.
"We now need to know more about @RobinhoodApp's decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit," she said.
Ocasio-Cortez's tweet prompted a response from Sen. Ted Cruz, R-Texas, who said he "fully" agreed.
This is unacceptable.
We now need to know more about @RobinhoodApp’s decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit.
As a member of the Financial Services Cmte, I’d support a hearing if necessary. https://t.co/4Qyrolgzyt
— Alexandria Ocasio-Cortez (@AOC) January 28, 2021
Robinhood — a trading platform that says it aims to "democratize" market trading — announced on Thursday that it was restricting trades on GameStop, BlackBerry and several other stocks that have seen unsual activity in recent days due to "recent volatility."
The meteoric rise of GameStop stock was fueled by amateur or part-time traders who banded together on social media and used apps like Robinhood to spoil Wall Street hedge funds' bets that the retailer's stock would tank. Hedge fund investors who bet against GameStop lost billions of dollars this week alone.
The decision is also causing the New York attorney general to investigate.