Robinhood raises $2.4 billion over weekend after GameStop fury

Robinhood raises $2.4 billion over weekend after GameStop fury
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The stock trading app Robinhood raised $2.4 billion over the weekend despite criticism it endured for pausing purchasing of some stocks popularized by online forums.

The day trading app’s Chief Financial Officer Jason Warnick said in a blog post Monday that the latest infusion “will help us scale 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 like Sequoia Capital.

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Robinhood took heat from almost all sides last week after blocking users from purchasing stocks from GameStop, AMC and Blackberry, companies which were targeted by the Reddit subforum r/WallStreetBets. 

The company has explained that it was forced to make that decision because the extra traffic on its product meant it had to put much more money into the clearinghouse that processes its trades. Traffic on Robinhood grew an unprecedented 1,200 percent last week, according to an analysis by Similar Web.

Robinhood CEO Vlad Tenev said late Sunday on invite-only social platform Clubhouse that last week an arm of Wall Street clearing house Depository Trust and Clearing Corporation demanded $3 billion in additional collateral. 

Although the demand was dropped to $700 million, Tenev said, the company was still forced to draw down existing credit lines.