The GameStop drama continues after the stock saw a massive crash yesterday, its value dropping by more than 75 per cent, going from a high of $483 to a low $112. The crash came after Robinhood and other major platforms used by retail traders took action to prevent additional purchase of stock in GameStop and other companies such as AMC Entertainment, Blackberry, and Nokia also hit by the retailer investor craze.
The price has since rebounded somewhat, to around $190. However, retail traders – many of whom bought high as the craze spread – are up in arms accusing Robinhood and other platforms of market manipulation. A class action lawsuit was quickly filed in the Southern District of New York formally accusing Robinhood of market manipulation. Meanwhile, on social media dark rumours swirled that Robinhood and other platforms had been leant on by hedge funds to stop the trading to try and limit the losses on their short positions (bets that a stock will go down).