Robinhood’s IPO put on hold amid GameStop controversy?
Trading and investing fintech app Robinhood is reportedly shelving its IPO to focus on dealing with the fallout of the GameStop incident.
Despite managing to raise an additional US$2.4bn on top of the , ’s executive leadership consider it unwise to proceed with going public until the ongoing controversy has passed. that the company was considering an IPO first circulated in November last year.
Ultimately, this may turn out to be a wise decision: customers took to the anonymous professional network to air their views, particularly amid claims that Robinhood had prohibited trading and sold users’ assets without permission.
Conducting an impromptu poll on whether the company had soured its chances of a successful IPO, 83% of 8,750 professionals believed this to be the case.
Musk grills Tenev on Clubhouse
“Do you want to hear the real story from Vlad [from] Robinhood about what happened on the Street with GameStop?” Musk , followed by, “What happened last week? Why couldn’t people buy the GameStop shares? The people demand answers, and they want to know the truth.”
However, Tenev, while acknowledging the rumour, countered that it was baseless in fact: “Robinhood stands for [...] democratising access to stocks,” he on Clubhouse. “We want to give people the access… but we had no choice in this case, we had to conform to our regulatory capital requirements.”
Tenev also stated that the resumption of trading on Monday would mark the end of the “stringent position limits” imposed on users at the end of last week.
Clearly, the debate provoked by this story will have grand implications not just for Robinhood’s future but potentially for all of fintech. Although it has the power to democratise the instruments of investment, how this new dynamic fits in with the established hegemony of Wall Street will form the ongoing conversation.
The FinTech Show: Bitcoin, crypto mining, and payments
In episode six of the FinTech Show (originally broadcast live on 11 June at 2pm BST), Scott Birch and Will Girling discuss:
- El Salvador becoming the first country to make Bitcoin legal tender
- China's decision to clamp down on crypto mining operations
- The new developments in post-COVID payments, including the EU's decision to give every citizen a digital wallet
We also explore the newly released June '21 edition of FinTech Magazine, including a special look at our profile piece on HOOPP and the future of small business lending (guided by iwoca). Special thanks go to Valeria Simantob for providing the front cover of that issue.
Before you go! Follow us on LinkedIn and make sure to tune in on 25 June for the next FinTech Show.