Executives at companies involved in the recent controversy between hedge funds and Reddit’s retail investors can testify at a hearing on the House’s Financial Services Committee next week.
According to a Reuters report, two people familiar with the matter said that executives from the trading app Robinhood, investment manager Melvin Capital and the hedge fund Citadel are expected to testify at a congressional hearing scheduled for February 18. Bloomberg reported that Citadel founder Ken Griffin is likely to be present, as will Robinhood CEO Vlad Tenev.
However, it is not clear at this point whether Melvin’s founder Gabriel Plotkin or anyone else in the hedge fund will participate. Reddit CEO Steve Huffman said on Friday that no one asked him to speak at the hearing, but other social media figures linked to the GameStop negotiations will come. Committee chairman Maxine Waters said in an interview on February 4 that Keith Gill, better known by his username on Reddit DeepFuckingValue, will speak.
The virtual audience will explore the allegations of market manipulation by Robinhood and major hedge funds in response to Redditors’ tightening of GameStop and others. Prominent members of the House, including Alexandria Ocasio-Cortez and Rashida Tlaib, were some of the first lawmakers to Call for Robinhood to respond to the Financial Services Committee after the trading platform suspended GameStop’s stock purchases on January 28.
The timing of the restricted negotiations was suspect due to Robinhood’s financial ties to Melvin and Citadel, leading to speculation by many that the platform had acted to protect the financial interests of hedge funds at the expense of retail investors on Reddit. Tenev is said to have said that the decision on the restrictions was taken by a clearing house and was based on capital requirements.
Although Robinhood subsequently eased restrictions on buying GameStop and other shares, GME’s price fell nearly 90% from an increase from $ 469.49 on January 28 to $ 49.50 at the time of publication.