How to Watch the Robinhood Congressional Hearing

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Photo: Noam Galai (Getty Images)

More real-time WallStreetBets drama, the David and Goliath tale of class and meme warfare that has it all, will unfold before our very eyes today in a Congressional hearing at noon, ET. Possibly aware that at least two forthcoming movies and two TV shows need some good material, the House Committee on Financial Services has snazzily titled the event “Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide.”  Sounds like a book.


Meet the emergent villains and/or anti-heroes: Robinhood CEO Vlad Tenev (hisssss), Citadel CEO Kenneth C. Griffin (BOOOO!), Melvin Capital CEO Gabriel Plotkin (off with his head!!!), Reddit CEO Steve Huffman (hold your applause), and Keith Gill, financial analyst better known as DeepFuckingValue (national hero or maybe grifter).

If you haven’t been following, WallStreetBets is a now-9 million-member subreddit accurately self-described as “Like 4chan found a bloomberg terminal.” While mainstream financial pundits dismissed them as nihilist maniacs, members like DeepFuckingValue identified an opportunity for a crowd-sourced short squeeze on GameStop stock. Hedge funds like Melvin Capital held large short positions on GameStop, a strategy which stands to generate money, in idiot’s terms, sort of as a reverse trade—selling and buying back at a lower price, rather than buying and selling for a higher price. Short sellers do so by borrowing the shares from a third party, usually a broker-dealer, and return them at a later date. If enough people buy the stock and drive prices up, they can motivate short sellers to panic and sell, further driving up prices, and, better yet for WSB, report embarrassing losses. (The WSB strategy also wielded options contracts, but I digress.)

Essentially, it’s gambling with magic money that bears no connection to actual labor or value, and WSB used a Wall Street maneuver against them. And it worked, spectacularly; in one week, GameStop rose by 1,700%, made a bunch of Redditors very, very rich, though at enormous personal risk. (GameStop has since tanked, but DeepFuckingValue has hope.)

Meanwhile, the large influential hedge fund Melvin Capital represents the kind of too-big-to-fail financial establishment that WSB often cites as the enemy, so when Citadel gave Melvin a $2 billion bailout, it wreaked.

But most people are presumably tuning in to watch the Committee on Financial Services skewer Robinhood’s Tenev, who made the decision to shut out Robinhood users from trading GameStop stocks at peak value, soon after which the price tanked. The company was also accused by many of automatically selling their shares, sometimes at a fraction of their buy price (though there is no verifiable proof of this, and Robinhood has flatly denied the claims). Robinhood’s decision, without warning, effectively shut out a lot of retail investors (WallStreetBets) while hedge funds and the uber-rich got a full-day pass to collectively control the market. Robinhood’s Tenev never provided a satisfying excuse for doing so (watch him squirm here). Many have speculated that Robinhood might have been protecting its financial partners like Citadel Securities (an arm of the company which bailed out Melvin), through which Robinhood routes its trades. The relationship was already a red flag.

Compounding mystery upon mystery, the SEC has just reported that over 1 million GameStop shares failed to deliver on the same day Robinhood blocked users from buying shares.


Sadly, the cards are again stacked against the people. Success hangs in the balance of Congresspeople that have time and again failed to grasp basic tech concepts and used their time to air personal complaints while the CEO gets off on some confusing gobbledygook.

You can tune in on C-Span or stick around here:



Vlad Tenev going for the Martin “Pharma Boy” Shkreli look....all he needs is the punchable shit eating smile.