Two of Wall Street’s leading hedge fund managers, along with chief executives of Reddit and Robinhood, will testify at the U.S. Congressional hearing next week about the turmoil surrounding GameStop stock trading.
The financial services committee of the House of Representatives published the list of high-level witnesses late on Friday. It includes Citadels Ken Griffin and Gabe Plotkin from Melvin Capital, as well as Reddit’s Steve Huffman and Robinhood’s Vlad Tenev.
The committee added that Keith Gill, the merchant known as “Roaring Kitty,” who emerged as one of the main players in the GameStop rally to attract political attention, would also appear.
The hearing, set to take place in Washington on Thursday, will be chaired by Maxine Waters, the veteran California Democrat and long-time financial services critic. The title of the hearing is “Game Stopped? Who Wins and Loses When Short Sellers, Social Media and Private Investors Collide”.
Testimony from Congress by senior financial services executives is quite common, but it’s rarer for top hedge fund and private equity executives to be grilled on Capitol Hill.
The political focus of stock trading has increased sharply in recent weeks. This came after a rally in GameStop stocks driven by private investors operating on the social media platform Reddit. They challenged hedge funds betting on the fall in video game shares.
When Robinhood, the online trading platform, stopped trading GameStop due to its volatility, it caused a backlash among retail investors joined by populist politicians from both the right and the left who said it provided evidence that the financial system was biased. of its greatest players.
GameStop shares, whose value peaked at $ 347.51 on January 27, has since fallen, closing at $ 52.40 on Friday. While GameStop stock trading has stabilized, Washington lawmakers and regulators have moved to verify whether the episode was triggered by market manipulation or other systemic issues in the financial system.
Last week, Janet Yellen, the U.S. Treasury Secretary, convened a meeting of top regulators, including the Securities and Exchange Commission and the Commodity Futures Trading Commission, saying the “ core market infrastructure was resilient, ” but the SEC would “ timely study ‘. of the events.
In addition, the SEC and CFTC will “assess whether trading practices are consistent with investor protections and fair and efficient markets”.