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Comment by amai | Hacker News Reader

"Robinhood got about 40% of their revenues from one of the hedge funds that just took a dive on Gamestop. Highly recommend an investigation. This smells like collusion to protect the rich insiders."

https://twitter.com/mindmeld_me/status/1354807424998281217

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Is there a source for the 40% figure? It seems to allude that the fund in question is Citadel.

First, I believe that number comes from this article[0], which doesn't tell the whole story. Did some research and found some more info with the help of this article[1]. In Q1, Citadel paid $12,583,220.60 to fulfill orders from Robin Hood[2]. I can't put together the total percentage of their order fulfillment revenue, but this website seems to suggest 91 million[3], but if you add up the totals from[2] they don't sum to 91 million--so I can't quite determine the percentage of revenue it works out to, but it appears Citadel is their biggest order fulfillment client.

[0] https://www.bloomberg.com/news/articles/2018-10-15/robinhood...

[1] https://fortune.com/2020/07/08/robinhood-makes-millions-sell...

[2] https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%2...

[3] https://www.businessofapps.com/data/robinhood-statistics/

Not revenue, but RH publishes their order flow percentages, which shows Citadel is at the top. Here's one from last year: https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%2...

Yeah it must be, they gave funds to Melvin Capital which took a beating on GME, and make money off Robinhood's customer flow.

Giving funds to Melvin so they can close their short != having a short position in GME

There are like 30 comments getting this confused in this thread.

This sounds a little pedantic to me. Citadel has exposure to a short position in GME due to their deal.

> Citadel has exposure to a short position in GME due to their deal

No, they don't. It's not pedantic - Citadel literally does not have a short position or exposure to a short position in GME.

If you lend money to someone, especially someone on the brink of insolvency, then you are buying whatever they are. Of course, Citadel can be on both or any number sides but they still take on exposure in that direction.

You're missing that they lent the money specifically so they were no longer exposed to the short position.

Yeah this is the central argument and I don't think we have a clear answer yet.

Citadel the hedge fund and Citadel the market maker are separate companies.

They do share ownership though. But the alleged conspiracy above is unlikely for other reasons.

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