Do they realistically stand a chance given that what Robinhood did is technically covered by their TOS? Are we finally going to get answers on how legally binding TOSses are?
So in a way, Robinhood is hurting all the people with existing long-delta and long-vega positions. Many of those people are Robinhood's own customers.
I guess Robinhood would have to demonstrate that the position isn't suitable for its customers, or that they couldn't guarantee orderly execution under the stress of a continued barrage of orders and new customer sign-ups.
This limitation definitely has an impact on GME stock, which is not good for RH because their own customers are largely the people who lose.
You can put whatever you want in your TOS, but if you lose money for your own customers and one of your investors (Ken Griffin) is on the other side of the trade, then you have a huge problem on your hands.
But what is the alternative? Other brokers (eg TD) have done the same as Robinhood. So what is retail to do? It seems like anywhere people would attempt to do something like what’s been going on with GME, would respond in the same way as RH to the pressure of the powers that be.
Brokerages can't manipulate markets.
It's illegal.