Robinhood’s IPO is reportedly on hold following GameStop drama

 Robinhood’s IPO is reportedly on hold following GameStop drama

Nameless sources inside digital trade Robinhood stated that its plans for preliminary public providing (IPO) have been placed on maintain amid the fallout of the GameStop saga, in response to Fox Enterprise Community senior correspondent Charles Gasparino.

“Ppl inside @RobinhoodApp inform @FoxBusiness plans for an IPO are on maintain to deal with surviving the present drama over buying and selling of shares and settlement points. Execs say they’ve entry to much more capital than extra quantities raised in the present day,” wrote Gasparino.

Lack of confidence

In keeping with a recent survey carried out on nameless community Blind, 83% out of 8,750 surveyed professionals assume that Robinhood has certainly “screwed its IPO.”

As CryptoSlate reported, Reddit group WallStreetBets has despatched enormous ripples internationally of finance when it managed to pump the declining—and closely shorted by hedge funds—inventory of video video games retail community GameStop (GME). Because of this, a number of huge gamers from Wall Avenue suffered enormous losses since they had been betting on the inventory’s worth taking place—not up.

Subsequently, Robinhood drew the ire of each most of the people and politicians alike when it restricted retail merchants from guying GME inventory amid the rally. The US Securities and Change Fee (SEC) has already acknowledged just lately that it “will carefully evaluate actions taken by regulated entities that will drawback buyers or in any other case unduly inhibit their capacity to commerce sure securities.”

Whereas Robinhood CEO Vlad Tenev later acknowledged that halting GME purchases “was a clearinghouse resolution, and it was simply primarily based on the capital necessities,” it seems to be like at the very least some irreparable harm to the platform’s fame has already been finished nonetheless.

Bracing for intense scrutiny

In the meantime, in response to Gasparino, the SEC isn’t the one company that determined to evaluate the GameStop saga. The US Congress is reportedly planning to suggest some restrictions on hedge funds buying and selling, together with brief promoting, in response to the GameStop incident.

“Hedge fund execs inform @FoxBusiness they’re bracing for intense congressional scrutiny, doable restrictions on buying and selling reminiscent of brief promoting amid [email protected]@RobinhoodApp frenzy,” Gasparino famous, including, “Hedge fund commerce teams gearing up and plan to foyer Congress.”

On the brilliant aspect, Robinhood halting GME trades has seemingly led to DeFi and crypto recognition and decentralized exchanges’ tokens have been booming these days as nicely.

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