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Executives of companies involved in the recent controversy between hedge funds and Reddit retail investors may testify at a House Financial Services Committee hearing next week.
Two people familiar with the matter said executives of trading app Robinhood, investment manager Melvin Capital and hedge fund Citadel are expected to testify at a Congressional hearing scheduled for February 18, according to a Reuters report. Bloomberg reported that Citadel founder Ken Griffin is likely in attendance, as is Robinhood CEO Vlad Tenev.
However, it’s unclear at this time whether Melvin founder Gabriel Plotkin or anyone else from the hedge fund will participate. Reddit CEO Steve Huffman said on Friday that no one had asked him to speak at the hearing, but other social media personalities related to GameStop trades would be coming. Committee chair Maxine Waters said in an interview on February 4 that Keith Gill, better known by his Reddit username DeepFuckingValue, would be speaking.
The virtual audience will explore the allegations of market manipulation by Robinhood and major hedge funds in response to the brief squeeze on GameStop shares by Redditors and others. Prominent members of the House, including Alexandria Ocasio-Cortez and Rashida Tlaib, were among the first lawmakers to call for Robinhood to respond to the Financial Services Committee after the trading platform suspended purchases of GameStop shares on January 28.
The timing of the restricted transactions was suspect given Robinhood’s financial ties to Melvin and Citadel, leading many to speculate that the platform acted to protect the financial interests of hedge funds at the expense of investors. individuals on Reddit. Tenev reportedly said the decision on the restrictions was made by a clearinghouse and was based on capital requirements.
Although Robinhood subsequently eased restrictions on the purchase of GameStop and other shares, the price of GME fell almost 90% from a high of $ 469.49 on Jan.28 to 49. $ 50 at time of publication.
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