In the past few days, a number of stocks, such as GameStop (GME) and AMC Entertainment (AMC), have risen dramatically in price, reportedly in line with the attention of Reddit users who buy in the face of sales pressure from big players. The popular trading platform Robinhood subsequently began to restrict customers’ ability to purchase various assets associated with the drama. When asked about his opinion on the suspension of GameStop stock purchases by Robinhood, Richard Byworth, CEO of crypto exchange EQUOS, highlighted the importance of freedom in the markets.
“It is always important to have free and transparent markets for all traders, and maintaining an open trading portfolio that is available for everyone to use is the responsibility of all trading platform providers,” Byworth told Cointelegraph. “The GameStop problem and the platform’s responses are likely to bring cryptographic assets into focus.”
On January 22, a GME share cost about $ 53, according to data from TradingView.com. On January 28, GME peaked at around $ 508 per share. In the hours following its peak price, the asset fell back to approximately $ 113. Since then, the price of GME has remained volatile, ranging from around $ 197 to $ 411.
“I think it is a clear indication of how the traditional financial system is broken and fundamentally manipulated,” Aleks Svetski, co-founder and CEO of Amber, a Bitcoin investment platform, told Cointelegraph.
“This will set all wrong precedents and is one of the final nails in the coffin for the relationship between Main Street and Wall Street,” he added. “WSB folks are also likely to switch to Bitcoin when they realize that it’s the only thing that can’t be disabled.”
The people held responsible for the increase in shares are part of the subreddit called Wall Street Bets, sometimes shortened to WSB. The team allegedly sought out shares with a keen interest from the short seller and bought shares in those assets, causing price rises, a CNBC article said on Wednesday. Robinhood suspended the purchase of some associated assets on Thursday.
What kind of effects can the suspension of the purchase of Robinhood’s assets have on the cryptographic space going forward? “Situations like this show why regulation is important and guarantee the existence of orderly markets, equal access to information for everyone and places of negotiation that provide customers with fair opportunities to negotiate, protect and take a stand,” said Byworth, adding:
“In cryptography, there were some exchanges that did not provide this type of trading environment, and it is often the customer who loses. It is the responsibility of the exchanges to provide a safe, transparent and compatible trading environment so that investors can access the markets they trust – by regulators and traders. At EQUOS, we do not trade with customers on our platform, like most crypto exchanges, nor do we sell our customer data to High Frequency Traders, as many traditional brokers have done. “
The United States Securities and Exchange Commission, or SEC, recently expressed its intention to investigate the events of the past few days.