Sequoia Capital said Thursday that it did not influence Robinhood, a stock market app, to halt trading any stocks.
Users of Robinhood, which allows users to purchase stocks without charging commission fees, banded together to purchase stocks in companies under financial strain, such as GameStop and AMC Theaters. In doing so, the price of those has risen. Some hedge funds, which had been believed the price of the stocks would fall, have decreased in value. On Thursday, Robinhood blocked users from purchasing stocks in GameStop and other companies, leading some to believe that pressure from Sequoia was the underlying cause. On Thursday, Sequoia denied that claim.
“Sequoia did not pressure Robinhood to halt the trading of any stocks,” the tweet said. “This rumor is completely false.”
Sequoia did not pressure Robinhood to halt the trading of any stocks. This rumor is completely false.
— Sequoia (@sequoia)
Rumors that Sequoia had pressured Robinhood into barring some transactions came from a Thursday post on Reddit from an alleged employee of Robinhood. The post alleged that Robinhood founder Vladimir Tenev had “received calls from Sequoia Capital and the White House that pressured into closing trading” on certain stocks.
Robinhood also restricted transactions for other companies, including electronics manufacturers Nokia and Koss, American Airlines and Bed Bath and Beyond. In a Thursday statement, Robinhood said the restriction on certain transactions was needed.
“We continuously monitor the markets and make changes where necessary,” adding that the restrictions were enacted “in light of recent volatility.”
Newsweek reached out to AMC Theaters for comment.
This is a breaking story and will be updated as more information becomes available.
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