Millennial-focused trading platform Robinhood just suffered one of its worst outages when Dow had its biggest point gain since 2009. Clients couldn’t log in while some couldn’t access certain volumes all throughout the close.
Many of its 10 million users went to Twitter and Reddit to complain about the start-up. Some even said they’d leave the platform as others threatened a class-action lawsuit.
The app began experiencing downtime issues at market open without estimates of when it would resolve. A potential cause could be the high trading volumes accompanying highly volatile markets over the past month.
Early reports also claimed the bug was from a Leap Day bug, but the company denied this.
Contrarily, users agreed to the possibility of potential losses before they finish signing up in the platform. The firm outlined it will not be responsible for temporary interruptions in service from maintenance or failures.
Robinhood might have saved itself through this consent form, although analysts believe this wouldn’t stop clients from lawsuits.
Robinhood was last valued at $7.6 billion, following a Series E funding round last year. Venture capital firms like New Enterprise Associates, Sequoia, and Ribbit Capital are all investors.
The firm offers free equity, options, and cryptocurrency trading for millions of millennial traders.
General partner at Propel Bentures Ryan Gilbert said the firm should take responsibility for its outages. With the firm’s current size, it’s “inexcusable” to a schizophrenic stock market.
Robinhood’s larger competitors cut trading fees after its extraordinary feat last year. Now, its appeal is rapidly evaporating amid a crisis that makes people buy stocks regardless.
Fidelity, Charles Schwab, and TD Ameritrade also reported technical difficulties last week. However, stocks had plunged from investor panic surrounded by the spreading coronavirus.
The three firms closed out of correction from increasing major averages on Monday.