Robinhood Limits Trade After $115M Investment Surge

Robinhood restricts GME purchases after Keith Gill (“Roaring Kitty”) discloses a $115 million stake. Gill’s investment fueled a 20% overnight surge. Settlement details are undisclosed.

On Sunday evening, Robinhood restricted purchases of GameStop shares in response to the meme stock’s surge in value. It transpired after conjecture that Keith Gill, the individual responsible for the significant short squeeze in 2021, might possess a considerable stake in the video game retailer.

Blue Ocean ATS, the platform that enables overnight trades for specific equities, will only accept orders within 20% above or below a reference price of $22.99, according to the brokerage. Therefore, traders would reject overnight orders to buy GME above $27.59 or sell it below $18.39.

The purpose of this restriction was to permit restricted trading during extended hours. However, some Robinhood users reported being entirely prevented from purchasing GME overnight.

Robinhood Restricted Trading Following an Overnight Price Surge Fueled by Gill’s GameStop Investment

The warning from Robinhood follows a Reddit post by Gill, whose YouTube handle is “Roaring Kitty.” This is Gill’s first post since April 21. Through his online influence, he is recognized as a pivotal figure in the 2021 GameStop short squeeze.

A screenshot shows he acquired 5 million GME shares for $115.7 million. In addition, he allocated $65.7 million for call options. It also detailed his wager that the price per share of GME would reach a minimum of $20 by June 21.

The screenshot also demonstrated that his GME holdings generated a profit of over $9.3 million. However, he incurred a loss of nearly $2.5 million due to his call options.

Following Gill’s Reddit post, GME surged nearly 20% in just 20 minutes on Robinhood’s overnight markets to reach $27.58.

On Friday, May 31, GameStop closed at $23.14, representing a year-over-year increase of 38.8% in its share price. The return of Gill precipitated the observed surge.

The Return of Roaring Kitty stimulates Market Speculation

Concurrent with his Reddit post, Gill also disclosed a green UNO reverse card on X on the same day. This adds to the sequence of enigmatic posts and parodies he has been disseminating since his reinstatement in May. I saw nearly 50,000 likes on the most recent post early Monday morning.

The doubled share value in May alone proves that Gill’s first foray into social media three weeks ago sparked an extraordinary upswing in GameStop. At the same time, meme currencies based on Ethereum, including one called GME, displayed renewed optimism.

Significant participants in the meme coin market have adopted GME tickers since Roaring Kitty returned to direct the subsequent bullish phase.