Robinhood Pauses 24-Hour Trading As The Market Goes Haywire

• Robinhood reportedly responds to the ongoing global market downturn with a halt of its 24-hour trading service.

Brokerage firm Robinhood has reportedly paused the 24-hour trading functionality on its platform as heightened volatility continues to plague global markets.

The development coincided with an intense global stock selloff, exacerbated by several factors driving investor skittishness. 

This includes the Bank of Japan’s recent interest rate hike, rising geopolitical tension in the Middle East, and the July weakness in the U.S. economy, triggering a shift toward risk aversion.

Investors Reassess Positions Amid Market Volatility

While Robinhood has yet to comment on the development, it didn’t fly under the radar of social media platforms, which have been abuzz with speculations. 

On X (formerly Twitter), a screenshot purportedly taken from Robinhood appeared to confirm the suspension.

JUST IN: Robinhood halts 24 hour trading. pic.twitter.com/3Ba7Mj6lyn

— Watcher.Guru (@WatcherGuru) August 5, 2024

One user claimed that Robinhood had taken the step to curb wild trading activity on the back of a volatile market. This could be conceivably true, with recent market developments serving as evidence.

Early Monday, Japan’s stock market suspended futures trade as the market plunged 8%. The Topix and Nikkei 225 Stock Average slid 12%, pushing their indices into bear market territory amid a surge in the yen. Nasdaq features dropped 3% in response to the development.

Takehiko Masuzawa, head of equity trading at Phillip Securities Japan, attributed the development to risk-off selling centered on cutting losses from long positions.

“Selling is bringing in more selling, people are dumping shares. The stage of selling mainly futures has long passed. Now futures players such as CTAs have not just closed their long positions but are also piling up new short positions.” Masuzwa told Bloomberg.

The Crypto Market Responds

Cryptocurrencies are perhaps among the biggest casualties of the ongoing global market turmoil. Over 17% of the cryptocurrency market cap was wiped out on Monday, causing it to fall from $2.16 trillion to $1.76 trillion within a few hours.

Bitcoin witnessed a dramatic fall of over 13% to trade below the $50,000 level for the first time since February. It reached a low of $49,351 before paring some of the losses to exchange hands at $52,640 at the time of writing.

Ether was also caught up in the middle of the market crash, plummeting at a steep rate, last seen in 2021. 

The crypto asset lost almost 20% of its value to trade at $2,322 at the last check. CoinMarketCap data shows that smaller cryptos like BNB, SOL, and XRP are all nursing steep losses of over 10%.