The ongoing GameStop saga has now caught the attention of New York City Congresswoman Alexandria Ocasio-Cortez.
Ocasio-Cortez, who serves on the House Committee on Financial Services, said she would support a hearing into the decision by the online trading platform Robinhood to restrict trading in GameStop and other stocks that have skyrocketed in an epic "David versus Goliath" battle on Wall Street.
"This is unacceptable. We now need to know more about @RobinhoodApp’s decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit," she tweeted. "As a member of the Financial Services Cmte, I’d support a hearing if necessary."
For those unfamiliar, the video game retailer's stock surged from around $17 a share earlier this month closing Wednesday at $345 a share after a group of investors banded together on Reddit to take on the big guys on Wall Street, who had bet the stock would fall.
"Over the course of the last few weeks, their enthusiasm for this money-losing retailer has crystallized into an absolute phenomenon," Washington Post global economics correspondent David Lynch told WCBS 880's Steve Scott. "It's the only stock anybody on Wall Street wants to talk about."
As the Associated Press reported, Robinhood on Thursday said investors would only be able to sell their positions and not open new ones in some cases, and Robinhood will try to slow the amount of trading using borrowed money.
The new restrictions will also impact trading in others stocks including AMC Entertainment, Bed Bath & Beyond, and Blackberry, to name a few, which have also suddenly soared.
"We continuously monitor the markets and make changes where necessary," Robinhood said in a statement on its website. "In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AAL, $AMC, $BB, $BBBY, $CTRM, $EXPR, $GME, $KOSS, $NAKD, $NOK, $SNDL, $TR, and $TRVG. We also raised margin requirements for certain securities."
Schwab and TD Ameritrade put similar restrictions in place.
"We're starting to see indications that some of the brokerage firms that a lot of these day traders use are taking some steps to sort of like cut down on the super active trading in some of these names, they have raised margin requirements to the point where it's unclear if you can actually trade on margin," Matt Phillips, of the New York Times, told WCBS 880's Wayne Cabot. "That would make sense for any market maker to do because they're gonna be exposed if this thing turns around and collapses."
Regulators are looking into this unusual trading closely and the situation raises questions about whether there's anything potentially illegal going on.
"In theory, if you could find evidence behind these posts, say on r/WallStreetBets, if you could find evidence that there was collusion, kind of an organized campaign of misinformation, or disinformation, false statements that were designed to do what's classically called 'the old pump and dump'... you could make the case for market manipulation," Lynch said. "It's not easy to do, but the FCC is certainly going to look at this."
The Associated Press contributed to this report