Vlad Tenev received $800m for taking the company public per an RSU agreement the board gave him in 2019 and $800m was when the stock price was $50+. Nows its only worth $130m. Banking is standard with discount brokers, you have a sweep account that is probably on an FDIC insured bank. GME issue was a lack of capital to settle GME trades. They owed $3 billion to NSCC. Robinhood was insolvent but people always flock to conspiracy theories on why Robinhood pulled GME trades. I am curious what would be the better decision for robinhood with the GME issue?
I don't use Robinhood but do benefit that my trades at other discount brokers are now free.
Didn't etrade and/or other frims do the same halting of GME because they couldn't cover the overnight options capital requirements?
Ultimately RH and others didn't have the ability to raise the crazy amount of capital they needed to cover trades over a very short time and instead of breaking these requirements and receiving the consequences (getting taken over by SIPC? or whatever, I don't actually know) they halted trading.
Failure to predict an unprecedented future, I suppose.
I don't use Robinhood but do benefit that my trades at other discount brokers are now free.