mr. plotkin, do you have any thoughts? mr. griffin: i believe you are asking one of the single most important questions posed today. i believe that the decline in the short interest as reported over the two week time, indicates roughly, and i apologize, roughly 35 to 40 million shares were bought back by parties that were short in stock. this would be a dramatic degree of short covering that could cause a dramatic increase in the price of gamestop. mr. plotkin: thank you for the question. i think, i do not have the exact answer to your question, but it is worth noting that the stock price move tire, there was a three day period where it traded almost 11 times during the entire flow. that kind of volume gave everyone who was short the opportunity to cover, and possibly institutional buying or some sort of combination. we did look at some of the activity in the stock and friday, january 22nd, there are options that were expiring that would have equated to 35 to 40 million shares of stock ownership. i do not think the short cover

mr. plotkin. mr. plotkin. mr. plotkin: i apologize. i do. chair waters: mr. huffman. mr. huffman: i do. ms. waters: mr. gill. gloip i do. chair waters: miss shupe. ms. schulp: i do. chair waters: all witnesses answered in the affirmative. we'll begin with testimony. you are recognized for five minutes toer for your tim. >> chairwoman waters, ranking member, my name is vlade tenney chief executive officer and co-founder of robinhood. thank you for the invitation to speak about robinhood and the millions of people we serve. almost eight years ago i founded robinhood i believed then and now that the financial system should be built to work for ever not just the select few. we dreamed of making investing more accessible, especially for people without a lot of money. it's a powerful wealth creator but the -- chair waters: [indiscernible]. mr. tenney: mr. mchen cri: the witness has the tune to give her own testimony. chair waters: you are not recognized, please go right ahead. [indiscernible] mr. tenney: we created robinhood to economically empower all americans by opening financial markets t

mr. plotkin and mr. griffin, the question is for both of you here whenever you're short selling i understand that gamestop stock was short sold 140%. and mr. plotkin, you made the comment in your testimony a minute ago that you were not trying to manipulate stock yet if you're short selling a stock 140%, for me on the outside looking in it looks like that is exactly what you're doing. explain to me why that's not manipulating the stock >> thank you, congressman. for us i can't speak to other people that were shorted any time we short a stock we locate a borrow. our systems force us to find a borrow so we always short stocks within the context of all the rules >> mr. griffin, would you like to comment on that you guys are both market makers and brokers and hedge fund guys. you do all of it why is this not considered manipulating a stock whenever you can short sell to 140% don't you think there should be a limit on something like that >> so i believe that the short interest in gamestop was exceptional and

mr. plotkin. mr. plotkin. mr. plotkin: i apologize. i do. chair waters: mr. huffman. mr. huffman: i do. ms. waters: mr. gill. gloip i do. chair waters: miss shupe. ms. schulp: i do. chair waters: all witnesses answered in the affirmative. we'll begin with testimony. you are recognized for five minutes toer for your tim. >> chairwoman waters, ranking member, my name is vlade tenney chief executive officer and co-founder of robinhood. thank you for the invitation to speak about robinhood and the millions of people we serve. almost eight years ago i founded robinhood i believed then and now that the financial system should be built to work for ever not just the select few. we dreamed of making investing more accessible, especially for people without a lot of money. it's a powerful wealth creator but the -- chair waters: [indiscernible]. mr. tenney: mr. mchen cri: the witness has the tune to give her own testimony. chair waters: you are not recognized, please go right ahead. [indiscernible] mr. tenney: we created robinhood to economically empower all americans by opening financial markets t

mr. plotkin and mr. griffin, the question is for both of you -- when ever you are shortselling, i understand the gamestop stock was short sold 140%. mr. plotkin, you made the comment in your testimony that you are not trying to manipulate stock. yet, if you are shortselling a stock 140%, for me on the outside looking in, it looks like that's exactly what you're doing. explain why that is not minute leaving a stock. >> thank you, congressman. for us, i cannot speak to other people who were shorted but anytime we sure a stock, our systems force us to find a bar so we always short stocks within the context of those. >> mr. griffin, would you like to comment on that? you guys are market makers and brokers in hedge fund guys and you do all of it. why is this not considered manipulating a stock when you short sell at 140%? do you think there should be a limit on something like that? >> i believe that the short interest in gamestop was exceptional. i am not sure it's worth us delving into legislative directions

mr. plotkin: people who have made millions in unrealized gains. absolutely it is testing building wealth. mr. gill: i believe it is an opportunity for investors to participate in the market >> the business -- participate in the market. >> the business channels have a question. would you buy their stock at 45? you were talking about being happy when it crossed 20. would you buy that stock today? >> investing is risky as my personal approach is aggressive and may not be suitable for anyone else, but yes. >> so yes or no? mr. gill: personally, i do find it attractive. >> did you invest in game stock because you were not aware of the payment for order flow? a lot of people bought into this because they don't know that. mr. gill: could you repeat that question? >> did you buy game stock because you were not aware of the investment and order flow? mr. gill: my investment was based on fundamentals. >> i believe that answers it. chairwoman waters: mr. vazquez -- misses vazquez, you are recognized for five minutes. >> thank you. [indiscernible] investing th

mr. plotkin: people who have made millions in unrealized gains. absolutely it is testing building wealth. mr. gill: i believe it is an opportunity for investors to participate in the market >> the business -- participate in the market. >> the business channels have a question. would you buy their stock at 45? you were talking about being happy when it crossed 20. would you buy that stock today? >> investing is risky as my personal approach is aggressive and may not be suitable for anyone else, but yes. >> so yes or no? mr. gill: personally, i do find it attractive. >> did you invest in game stock because you were not aware of the payment for order flow? a lot of people bought into this because they don't know that. mr. gill: could you repeat that question? >> did you buy game stock because you were not aware of the investment and order flow? mr. gill: my investment was based on fundamentals. >> i believe that answers it. chairwoman waters: mr. vazquez -- misses vazquez, you are recognized for five minutes. >> thank you. [indiscernible] investing th

mr. plotkin. mr.uffman, you have five minutes to present your oral testimony. >> madam chairwoman, mr. ranking member and honorable members of the committee. my name is steve huffman and i'm co-founder and ceo of reddit and i am pleased to talk about how reddit works and what we have seen on our site in the past few weeks. reddit's community is to bring belonging to everyone in the world. what started in 2005 as a single community has since evolved into a vast network of many thousands of communities they range from standard topics like news, sports, politics to internet culture to support. for example, our unemployment community has become a source for hundreds of thousands of community who have turned to reddit after losing a job during the pandemic it is used and run by our users. we describe reddit as the most human place on the internet though we are small compared to the larger platforms it provides an online home for millions of people every day i would like to share how content works. the plat

mr. plotkin. when did melvin first take a short position in gamestop >> thank you, congressman. that was in 2014 really right at our inception of the fund >> and when you did that, you continued to maintain a short position >> that's correct. >> so you said you analyzed the value of the stock and you, by taking a short position, you, unlike mr. gill, thought that the stock was overpriced he thought it was under priced, you thought it was joefr priced. >> that's a good conclusion, yes. >> okay in your analysis, when you started into the short position, what did you think the stock was worth? >> i don't remember exactly at the time i think when we launched it was probably a 40-dollar stock i think we believe the company had a lot of, you know, structural challenges. we have seen their earnings go from, i think, north of $3 a share to almost negative $3 a share, so there's been a lot of challenges fundamentally >> last question for you, were you in a naked position in your short position because the stock was oversold >> no, our systems won't even allow that, so that would be impos

mr. plotkin. you spoke of the anti-semetic attacks that you suffered on line as a important of color, i always feel the need to confront hate speech and speak out. i don't think there has ever been a more hateful, evil, sinful event in human history than the holocaust so i want to apologize to you and your family for those attacks. you brought it up. i think we owe you an eye poll gee. i want to apologize for that sometimes i think some of my colleagues on the other side of the aisle are devoid of any contact with real people when they say this is just political theater or they don't want to know the rate of return when that's exactly what people want to know. in fact, there has been a great deal of interest in this hearing i think it is because there is great distrust in our society, in government, markets, institutions then along comes this story of game stop. and it is a story, really, of robinhood turned on its head and the reason i say that is mr. -- [ indiscernible -- brought it up robinhood

mr. plotkin, you made the pointa minute ago that you were not trying to minute stock.%, for me on the outside looking in, it looks like that's exactly what you're doing. >> i can't speak to any people who were shorting. our systems force us to find borrowers, so we always short stocks in the context of -- [inaudible] liz: melvin capital founder and ceo gabe notkin defending his plaids in front of the house financial services committee earlier. let's get to charlie gasparino who's been reporting on the story since day one. charlie, one of the things gabe plotkin said was he really felt this was a company that had no value whatsoever which is in complete opposite opinion of the trader keith gill who who has ao testified today. >> yeah. i trust gabe plotkin over keith gill, although keith gill might have made more money on this trade in particular. liz: he did. >> the analysis on gamestop is pretty solid. i mean, it's a company that's burning cash. your last guest just explained the short thesis, and it's right there. it's what you see. the analysis for the longs is, oh,

mr. plotkin. clearly your testimony today was -- hello? your testimony today was that melvin capital had not engaged -- i'm sorry. i think you are not muted. earlier today you mentioned that melvin capital not engaged in a naked short of gamestop. and melvin closed out his position -- chair waters: i am sorry, your time has expired. >> thank you. i want to thank our panel for being with us for a very substantive and long afternoon. i think i might be a welcome face for them, because i am the last one to ask questions here. i want to talk with mr. tenev about options. i agreed with what other members of the committee have said from both parties about the value of democratizing access and that we should give latitude for independent retail investors judgment. but in fields where there is an information asymmetry between the user of a product or service and the provider of a, there is always a professional code of ethics around them. you go to a doctor or a lawyer, there is a code of ethics that protects someone who does not understand as muc

mr. plotkin, you're now recognized for five minutes to present your oral testimony. neil: all right. i just want bring up, this is a significant development. i told you i want to make we're a little careful how we dodge and weave out of this, not to bore you to tears, to get the most important type of early testimony we can including all of these gentlemen's opening statements but in the case of citadel securities, i think charlie gasparino, had it right who is joining me right now he will be the focus of a lot of this here, even though he denied all the allegations that have been out there, robinhood limiting trading in some hot stocks was as a result of citadel forcing its hand making that happen. not quite so. you might try to explain that calmly, reminder there were other factors at play here, but again he is the rich guy. he is the richest of all the guys making testimony today, charlie, and he's the guy they will say all right, you are a hedge fund guy. you make a lot of money. we know hedge fund guys, we don't know how you do it but you make an obscene amount of money and we t

plotkin who runs melvin's capital ceo. we have more. >> you may flag that it is wrong, but you won't take it down >> congresswoman, it is, it depend fons context. >> mro the hell elected you and put you in charge of what the media are allowed to report? >> big tech was the last group the face lawmakers and the bank executives faced the music in the financial crisis and tomorrow, it is a rare combination of wall street and silicon valley. robinhood's 23-year-old ceo is among the most scrutiny, and dan gallagher who joined robinhood last year has beefed up the communications team, and hiring from the wall street regulatory agency and hiring from president obama's treasury department, and they have also hired reginald brown, a congressional lawyer who helped to prepare mark zuckerberg. and also, elizabeth warren could hint at the line of questioning from her colleagues tomorrow. she said that robinhood's response to the letter reveals that they did not have enough cash on hand to handle the surge in trading and buried the consumers rights. >> reporter: in a testimony released today, vlad tenev fights back to the allegations that they were colluding with