Feb. 5 (UPI) — Investing app Robinhood on Friday lifted restrictions for trading all stocks, including GameStop and AMC Entertainment, after a surge in transactions last week led to a volatile market revolt over the practice of “shorting” stocks.
Robinhood suspended trading more than a week ago when users from a social media Reddit group bought up shares of GameStop, AMC and other companies, causing major losses for hedge funds that were partly staked on betting against, or shorting, those stocks.
Robinhood then placed limits on app activity in an effort to stabilize the market.
Friday, the investing app lifted those suspensions for all trading activities, including GameStop.
“There are currently no temporary limits to increasing your positions,” a message on Robinhood’s website said Friday.
The trading restrictions had only allowed users to sell shares, but not buy new ones. At the time, Robinhood said it limited trading because it wasn’t able to meet legal deposit requirements that it projected from the abrupt spike in transactions.
The company has since raised billions from investors.
Janet Yellen, President Joe Biden treasury secretary, met on Thursday with officials from the Securities and Exchange Commission, Federal Reserve and other fiscal agencies to examine the impact of last week’s trade frenzy.
“The regulators believe the core infrastructure was resilient during high volatility and heavy trading volume and agree on the importance of the SEC releasing a timely study of the events,” the Treasury Department said after the meeting.
“We really need to make sure that our financial markets are functioning properly, efficiently, and that investors are protected,” Yellen, the former head of the Federal Reserve, told Good Morning America.
“[We] need to understand deeply what happened before we go to action, but certainly we’re looking carefully at these events.”