Barstool Sports founder says he lost $ 700,000 in GameStop Rally
- Barstool Sports founder Dave Portnoy said he lost $ 700,000 on “meme stocks” like GameStop.
- Portnoy tweeted that the CEO of the Robinhood trading app “stole it from me and should be in jail.”
- The stock market is reeling from a frenzy triggered by a group of Redditors.
- Visit the Business Insider homepage for more stories.
Barstool Sports founder Dave Portnoy said on Tuesday he lost about $ 700,000 on “meme stocks” like GameStop.
Portnoy tweeted that he had officially sold all actions he bought. He berated the Robinhood trading platform and its CEO, Vlad Tenev, for blocking users from trading the stocks driven by the buying frenzy fueled by Reddit.
“Vlad and company stole it from me and should be in jail,” Portnoy tweeted.
—Dave Portnoy (@stoolpresidente) February 2, 2021
Portnoy’s losses followed a stock market frenzy triggered by a group of people on Reddit who bought stocks like GameStop, pushing company values up. Many people used trading apps like Robinhood to participate in the rally. Robinhood saw an increase in the number of new members and was forced to temporarily prevent users from purchasing shares of GameStop, AMC and others; he said he complied with the financial requirements.
Read more: Robinhood user files class action lawsuit against trading app hours after blocking GameStop purchases
This decision angered many users and lawmakers of the app, such as Representative Alexandria Ocasio-Cortez. Robinhood allowed trading to resume but added limitations for 50 stocks including GameStop – Robinhood said it would cap the number of GameStop shares that users could buy at 20.
Robinhood raised over $ 3 billion in emergency investments until now to compensate for the surge in exchanges on its platform. Tenev defended the company’s initial decision to stop trading in some shares and said Robinhood was not struggling with
Read more: GameStop jumped over 600% last week. 3 pundits explain where the action could go from here as Reddit’s army of traders takes profits and searches for their next targets.
And Tenev told Tesla CEO Elon Musk in an interview on Sunday that Robinhood was forced to restrict trading for users because the hike prompted the National Securities Clearing Corporation to request a $ 3 billion deposit.
Fixed: This post has been updated to state that Portnoy is critical of Robinhood’s decision to restrict trading of certain stocks.