A report says that Robinhood was downloaded over 1 million times from Wednesday to Friday amid the company banning or restricting the purchase of several stocks, and users retorted furiously about the company across social media. The upswing in accounts came as the market was entranced by a jump in pajama trader of stocks like GameStop [$GME] and AMC [$AMC].
Even so, the strong number for Robinhood is surprising given that the broker faced a cavalcade of stresses last week. What’s more, Robinhood was forced to tap credit lines and received $1 billion from current investors while juggling rumors that its decision to limit trading of GameStop and other stocks was duplicitous.
Alexandria Ocasio-Cortez and other legislators took to Twitter urging Congress to look deeper into Robinhood’s actions. Robinhood said on Monday that it had raised another $2.4 billion from its investors, for a total of $3.4 billion. The investment round was led by Ribbit Capital, with existing investors including Iconiq, Andreessen Horowitz, Sequoia, Index Ventures, and NEA also taking part.
Robinhood clarified in a blog post that those limits were based on demands from its clearinghouse that it put up more collateral based on the volume of trades going through its system. Its deposit requirements 10x’d, according to a blog post that Robinhood released.
JMP securities analyst Devin Ryan reported on Monday that Robinhood looks to have been downloaded 550,000 times on Wednesday and over 600,000 times on Thursday. On Friday, it was 300,000 times. Calculations in the report denote that Robinhood’s app was downloaded more than 3 million times in January, which would likely be a record for any broker ever. Charles Schwab [$SCHW], the largest broker in the industry, added about 3 million net new accounts in all of 2020 after backing out its purchases of TD Ameritrade.
Robinhood’s best day last March, during a trading frenzy at the beginning of the pandy, was 140,000 downloads. Robinhood has not revealed its latest customer count in months, after saying it had 13 million account-holders last May. Ryan called the app download numbers “tremendous,” and said that it shows Robinhood “experienced record growth during some of the most challenging days operationally this past week.” Other brokers saw similar interest, with start-up Webull and crypto-focused exchange Coinbase also seeing enormous growth.