WATCH: House Financial Services Committee Holds Hearing on GameStop
The House Financial Services Committee is set to convene at noon on Thursday to hold a hearing on the January ordeal involving GameStop’s surging stock price.
Witnesses will include Robinhood CEO Vlad Tenev; Citadel CEO Ken Griffin; Melvin Capital CEO Gabriel Plotkin; Reddit CEO Steve Huffman; and Keith Gill, the trader known as “Roaring Kitty” who has become synonymous with Reddit’s “WallStreetBets” forum. Mania on the forum caused GameStop’s stock price to rise by 1,022 percent in a week last month before it declined by 90 percent. Some investors gained from the surge, while hedge funds including Citadel and Melvin lost billions betting the stock would fall.
Robinhood, a trading platform that works by sending customer orders to high-frequency traders including Citadel, briefly prohibited users from trading GameStop and other affected stocks, including stock in AMC Theatres. The move incited outrage among traders, but Tenev said his company did so only long enough to raise more cash, which he said it needed to comply with regulations that require it to hold enough capital to cover volatile market conditions.
Gill, who prompted the run-up in the price of GameStop’s stock, invested $53,000 in the company’s stock and options in June 2019, and began talking about it online under his “Roaring Kitty” persona. That investment was briefly worth nearly $50 million at its peak. Gill subsequently quit his job at MassMutual, where he worked as a director of financial wellness education, and is the target of a proposed class action lawsuit by a trader who alleges that he lost money during the fiasco.
His testimony notes that he still believes in the company, and as a loyal customer, is “looking forward to buying a new console at GameStop.”
“As for what I expect moving forward: GameStop’s stock price may have gotten a bit ahead of itself last month, but I’m as bullish as I’ve ever been on a potential turnaround,” Gill’s remarks add. “In short, I like the stock. And what’s stunning is that, as far as I can tell, the market remains oblivious to GameStop’s unique opportunity within the gaming industry.”
Watch the hearing above at 12:00 Eastern via the House Financial Services Committee.
