Stock trading app Robinhood raised $ 2.4 billion over the weekend, despite criticism it faced for pausing the purchase of some of the stocks popularized on online forums.
Day trading app Chief Financial Officer Jason Warnick said in a blog post Monday that the latest infusion will “help us scale up to meet the incredible growth we’ve seen and demand for our platform.”
The funding round was led by Ribbit Capital and included previous investors such as Sequoia Capital.
Robinhood received heat from almost all quarters last week after blocking users from buying shares in GameStop, AMC and Blackberry, companies targeted by the Reddit sub-forum r / WallStreetBets.
The company explained that it was forced to make that decision because the extra traffic on its product meant it had to put a lot more money into the clearinghouse that processes its transactions. Traffic on Robinhood grew by an unprecedented 1,200 percent last week, according to an analysis by Similar Web.
Robinhood CEO Vlad Tenev said late Sunday on invitation-only social platform Clubhouse that last week a branch of Wall Street clearing house Depository Trust and Clearing Corporation demanded $ 3 billion in additional collateral.
Although demand had fallen to $ 700 million, Tenev said, the company was still forced to draw up existing lines of credit.