The story.In the order it happened.
Everything on this page is public record. The Congressional hearing, the fine, the movie. We didn't write the lore, we just gave it a ticker.
They called it a market failure. We call it a ticker.
- Act oneThe day.
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The squeeze is on
GameStop is the most shorted stock in America and retail has noticed. GME closes the day near $347, up from under $20 at the start of the month. Hedge funds are bleeding. Robinhood is the app everyone is buying it on.
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The clearing call
The clearinghouse asks Robinhood for a deposit of about $3.7 billion to cover the risk on its customers' positions. Robinhood doesn't have it. The company is hours away from not being able to settle trades.
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Position Closing Only
Robinhood turns off the one thing it can turn off: its customers. GameStop, AMC and a handful of others go to Position Closing Only. You can sell. You cannot buy. Around 13 million users find out by pressing a button that is no longer there.
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483 to 112
With the biggest pool of buyers locked out, the stock has one direction left. GME prints a high of about $483 and a low of about $112 in a single day. People who had been told they were early are told they can only leave.
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"Not a liquidity problem"
Robinhood's founder goes on television and says the restrictions were not about the company running out of money. The deposit request, the amount and the timing come out later, in filings and under oath.
- Act twoThe record.
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Congress
The House Financial Services Committee holds a hearing on the events of 28 January. Robinhood's founder, the head of Citadel, the head of Melvin Capital and Keith Gill, known as Roaring Kitty, all testify. The transcript is public and it is long.
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The record fine
FINRA fines Robinhood roughly $70 million for, among other things, systems outages and misleading customers. At the time it is the largest penalty in FINRA's history.
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The movie
Hollywood makes a feature film about the squeeze and the day the buy button disappeared. Millions of people who were never in the trade now know the plot. The lore no longer needs explaining, which is the whole reason a meme can be built on it.
- Act threeThe confession.
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"A market failure"
Robinhood's founder posts about 28 January 2021 and calls it a failure of the market. His proposed cure: stocks on a blockchain, where nobody can halt trading. The post does 1.2 million views. The people who were halted read it too.
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Robinhood Chain, with GME on it
Robinhood launches its own L2 and lists tokenized stocks on it. Among them: GameStop. The company that froze GME now issues it on a network where, by its own description, nobody can freeze anything.
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$CLOSE
A token named after Robinhood's error status, launching on Robinhood's chain through pons, paired to the stock Robinhood froze, paying its holders in that stock. The status that stopped 13 million people becomes a ticker trading against GameStop, and the tax on every trade goes to the people holding it.