Trading platforms such as Robinhood and Trading 212 said on Thursday that they were preventing users from buying shares in the video game retailer as a surge in investor demand sent their servers into meltdown
The ongoing Reddit-inspired bull run in shares of GameStop Corp () has encountered another hurdle as several popular trading apps suspended trading of the stock and others associated with the rally as a surge of investor demand disrupted their services.
READ: GameStop’s Reddit-driven ‘YOLO’ trading frenzy draws attention of White House, US regulators
On Thursday afternoon, US trading app Robinhood said it was restricting trading in shares of GameStop and other companies including cinema chain Inc () in response to the current market volatility.
In light of current market volatility, we are restricting transactions for certain securities to position closing only, including $AMC and $GME. Read more here.https://t.co/CdJMjGAeFH
— Robinhood (@RobinhoodApp) January 28, 2021
Meanwhile, rival platform said that it had also decided to temporarily stop users buying GameStop and AMC shares in order to “mitigate risk for our clients” in what it said was “an unprecedented market environment”.
Trading 212 also restricting things, apparently for our safety! ???? pic.twitter.com/Owukx6dhP6
— Guy Lambert (@GRALWrites) January 28, 2021
The two platforms have now restricted the shares to ‘reduce-only’ mode, meaning users can only sell shares they already own in the firms rather than purchase new ones, a move that quickly attracted the ire of traders looking to get in on the rally, which was sparked by a desire to upend large bets made against short sellers against GameStop but has since evolved into a battle between retail investors and financial institutions.
Despite the throttling, GameStop’s shares were still managing to ascend in mid-morning trading in New York, up 14.8% at US$397.08 at around 10.30am Eastern Time.
Read More: Reddit-inspired GameStop Corp trading frenzy throttled as trading