we hear from vlad tenev again next.rg. ♪ >> it's nonnegotiable for us to comply with our financial requirements and our clearinghouse deposits. so, we have to do that. robin hood has always stood and will continue to stand with the individual investor. anna: that was the robin hood ceo, vlad tenev, speaking to bloomberg. the trading app has raised over $100 billion -- $1 billion from its own investors. this is the latest piece in the saga which is cap as busy. what was happening -- kept us busy. what was happening behind the scenes? dani: well, it really does come down to mitigating counterparty risk. to put it in more concrete terms, when a trade is done, it actually takes two days for the settlement to happen. and in that today period, whoever -- two day period, whoever has to put up money, has to put up collateral to manage risk before the trade is finally settled. but what happens when you get all this volume, all this volatility, the cost of doing so, that amount of money you need to set aside absolutely skyrockets

chief executive vlad tenev told bloomberg no market participants force the company to make a move. : so there's a lot of misinformation out there, in particular, there's people saying that we were forced to do this by market makers, to reroute to other market participants, and i just wanted to come out and say that that is categorically false. we were not directed by a market maker or any other market participant. this was a technical and operational decision that we made, because robinhood, as a brokerage, has financial requirements, including clearinghouse deposits, that we have to make to various clearinghouses. some of these requirements fluctuate on volatility in the markets, and in this current unprecedented environment, can be substantial. so to protect the firm and to protect our customers, we temporarily disabled buying in these securities. and we hope to reenable buying as soon tomorrow morning. emily: so, that said, did any other investors or market makers ask you to halt market trades, even if that is not the reason why you did it? vlad: now. emily: -- vlad: no. emily: t

robinhood ceo vlad tenev speaking to cnbc addressing the widespread criticism his firm is now facingi want to address misinformation that's out there because there's a lot of it. we absolutely did not do this at the direction of any market maker or hedge fund or other market participants. the reason we did it was because robinhood is a brokerage firm. we have lots of financial requirements there was no liquidity problem, and to be clear. this was done preemptively, so we did this proactively, and thousands of other securities remain tradeable on the platform, customers that held these positions were able to sell them, and we're doing what we can to allow buying and to remove these restrictions in the morning. >>> robinhood is raising $1 billion from the existing enves tors, a -- investors. spilling over into the global markets, asia closing lower overnight, and the major european markets seeing a lot of red this morning our julianna tatelbaum joins us from our london newsroom, and what are you seeing over there. >>> the retail frenzy, whether this is a fascinating story to watch or i

we are joined by vlad tenev. the question is why? you to restrict trading on these names went to be fair, there has been volatile trading for days if not weeks. vlad: thanks for having me, emily. we didn't restrict trading, we restricted buying on 13 securities on the platform. customers who held positions on those securities could sell them and customers were also able to trade thousands of other securities on robinhood throughout the time without restrictions. it has been an unprecedented market environment the past couple weeks, where there has been concentrated investing around stocks that have been very, very popular on social media. you are seeing an intersection of social media and finance, and retail investors, individual investors, participating in markets like they never have before. robinhood has been number one on the app store for the past few days, and we have seen growth in activity, in volume, and elective interest around these names. so we had to make a very difficult decision to restricted buying, but it wasn't restr

emily: vlad tenev, ceo of robinhood.ding somewhat restricted in the platform but has opened up a bit rate for more on what we have been watching, we are joined by brian barnes. even after that interview with vlad, many people don't understand why robinhood did this. want them to be more clear. i have never seen so much vitriol in my twitter feed. folks unhappy with his explanation. you instituted some sort of trading limits but were more clear about why. tell us why you halted some securities, and explain the rationale. >> first, thank you for having me. not all of these brokerage platforms are the same. there is big difference between trading platforms and investing platforms. i think m1 is more geared for long-term, systematic investing. it is not a day trade platform. it is about designing a custom portfolio. and automating it read we have a more longform -- long-term oriented approach. the trading mentality, gamestop and amc has been less a core component of our business. yesterday, we hit about $75 million. it was m

francine: well, that was the robinhood chief executive, vlad tenev.up, mark carney, former bank of england governor. ♪ ritika: this is bloomberg surveillance. i am ritika gupta in the control room. coming up that it today, the international chairman and ceo. this is bloomberg. >> if we are really going to be moving to a net zero carbon environment, all of society has to move, not just public companies. >> governments worldwide are going to need to invest in the r&d of how to prepare for climate change in helping us design and build new technologies. francine: that was the blackrock chief executive larry fink discussing climate change at the bloomberg year ahead virtual conference. we here to talk about climate change as well as how it relates to fund managers. mark carney, the u.k. prime minister's finance advisor. thank you for joining us. a lot going on in the markets. if you look at what some market participants are doing, this huge volatility because of the day traders -- is there a danger that this is the way things will be in finance and they ta

and now, vlad tenev is saying that they have move stopped trag in certain stocks is best for some companies. >> i want to address some of the misinformation because there is a lot out there. we did not do this at the market maker or anybody that we route to, and the reason that we did it is because robinhood is a brokerage firm we have lots of financial requirements including s.e.c. net capital requirements. >> but here is the problem. robinhood is not just a broker, it is a clearinghouse as well, and without getting into the weeds, what it means on the basic level is that it has a lot of money at risk, and it had to go begging to the venture capital partners last night to shore up the books. and let's bring in our friend, former colleague katy kelly crack new york times reporter and has the latest on the emergence of the robinhood's money, and without getting into the weeds, they are not just a brokerage company, but they are subject to the same rules of the big names they are trying to displace, and it burned them yesterday. >> yeah, brian it is an interesting story, because a part of the

vlad tenev told me this would help them expand quickly and liken it had to apple deciding to build itsad of relying on a third party, think of square, who use a middleman and another clearing house, robinhood settles and clears customer trades, provide custody for assets giving them a bigger slice of the revenue behind trading it also raises the bar for how much money robinhood needs to have in house to meet those capital requirements they need to send cash every day to the depository trust company nope as the dtc, and that can change on a dime based on trading volumes. i'm told the dtc increased the amount firms needed for margin calls especially on gamestop robinhood told cnbc these moves were preemptive. they raised $1 billion from existing investors, sequoia and ribbit in there, had to tap their banks for a line of credit, and told some customers they might need to close at-risk positions. robinhood getting accused of changing the rules in the middle of the match robinhood has to comply with regulators it happens all the time at schwab and fidelity. viral social investing, robinhoo

leslie >> reporter: well, shep, robinhood ceo vlad tenev on cnbc saying that the firm's decision to limit buying to, quote, protect the firm and protect their customers. now, we heard from sources that robinhood is tapping hundreds of millions of dollars in credit line from banks to shore up its balance sheet. but ceo tenev said this about the health of his business moments ago. >> i know how clorox and lysol felt in the pandemic when they were running out of hand sanitizer and supplies we just haven't seen this level of concentrated interest marketwide in a small number of names before >> robinhood put out a statement hours ago saying that starting tomorrow, they would resume, quote, limited buys of these securities and may make adjustments as needed. still, as retail investors saw their ability to buy certain securities thwarted today, hedge funds and other professional investors who can execute their own trades soldiered on, fueling more anger from the retail community over what they see as unfairness in this system. now, the issue is working its way through the courts a class action s

so, the robinhood ceo, vlad tenev was on cnn yesterday, making the rounds trying to explain this decisionties to, you know, meet various deposit clearinghouse requirements that robinhood is required to clear. he says that they, robinhood, relied on lines of credit from major banks as a proactive measure, but that, of course, did not satisfy the criticisms of a lot of people who thought it was a major double standard. you have other different people, different trading platforms who have also restricted trading, like ameritrade, interactive brokers, but robinhood has really gotten the brunt of the criticism because their entire mission was to democratize finance, make it accessible, especially for younger people to trade from their phones, be players in the market. so, while these other platforms are also restricting trading -- for example, interactive brokers seems to be less keen on reallowing purchases of these stocks -- it's definitely a really tough decision for robinhood, and they're just trying to sort of, you know, deal with the volatility and be able to meet these certain requireme

but vlad tenev, thank you for coming in and making the case for robinhood. >> thank you very much.e want nothing more than to enable investing and access to as many individuals as possible. that's our mission and it's in the name of the company. >> just got to make sure that something named robinhood isn't rigging it for the sheriff of nottingham. you know what i'm saying? like if you're going to set it up where the little guy can win, they should be able to play firly fir fairly and see that on it. you have this as a venue as we move along. good luck. the other side of the story is individual investors who came together on reddit which is an amazing story in itself. the man who founded wall street bets is here. his name is jamie rogozinski. a nice irish name. he did step away from it last year but he's here now. i saw you, i know you're heated up about this, mr. rogozinski. first, jamie, what was your response to what you heard from the head of robinhood? >> thanks for having me. i want to start by saying i hope you take it easier on me. i don't have as much experience as him. i'm

let's dig into the decision with robinhood's ceo, vlad tenev, thank you for joining us. >> chris, thank for having me. this is surreal for me. i've been watching your show live, especially through this past year. >> i appreciate it. look, you know my audience. this is not an investment show. and i don't think it needs to be. i don't really care about your capital commitments, your liquidity, and what was going on in the regulatory side. and i'll talk to you a little about that. but i want you to address the obvious. this looks like a move by an outfit called robinhood, which is supposed to be taking from the rich and giving to the poor, and doing exactly the opposite. that when the big guys, including one of your main investors in your company, started to lose, you shut down the game to starve the little guy. fair criticism? >> that's not what it is at all. and i know you started this segment -- it really resonated with me because you described the story of robinhood. robinhood started five years ago by pioneering commission-free, no account minimum, mobile investing. we've been the spo

but robinhood's ceo vlad tenev said they've got it all wrong, it was really about market mechanics. >al requirements, including s.e.c. net capital requirements and clearinghouse deposits. in order to protect the firm and protect our customers, we had to limit buying in these stocks. >> so let's just walk through this, to be clear, this was not about robinhood or any of these other trading platforms trying to rescue over the little guy but they did fail. they had to stop trading to comply with government rules and basically keep themselves from going out of business screw over one side of the trade or another but they made it clear they were not able to step up in volatile times, begging the question can they do it going forward? my next guest is another ceo forced to restrict some buys yesterday, yanek malling, a social network for investing, and jamie rogasinski founder of reddit wall street bets where this all got started. yanek, apps like robinhood and yours are about bringing the little guy into the market. not just those with big accounts and broker dealers. what happened yesterd

ceo of robinhood vlad tenev is writing an op-ed, i asked vlad about gamestop, of course, we've all beent ship as part of this short squeeze. whether those that are investing in this fully understand what they're investing in >> without commenting on individual stocks and whether people should or should not be investing in them, what i'll say is that, you know, like many others in the industry, we have processes that respond to increases in volatility in certain names, by doing things like raising the margin requirements so, you know, we've done that in lots of cases. and, you know, we were -- we always remain focused on making sure the system is reliable, that we're investing in stability, making sure we're up for customers when they need us the most and that we're investing in customer support so, those remain our two priorities and other than that, you know, as you've seen with this market, there's things happening, different things happening, every week and i think we have to avoid, you know, running our business as if we're responding to, you know, what's in the news on a weekly bas

robinhood also raised margin requirements for certain securities the company's ceo, vlad tenev speaking out in an interview last night i asked him how concerned customers should be about the robustness of the system >> well, to be clear, this was the system working we have the ability to restrict buying in symbols for unprecedented market conditions such as this, and to be clear, we didn't shut down the system we shut down buying for these 13 stocks, for these 13 security, but customers that held positions could still sell, and customers still could buy and sell the thousands of other securities on the robinhood platform >> but when you look at the precipitous fall, for example, of gamestop today, do you think that robinhood bears any responsibility for that? >> i can't comment on, you know, price action of securities and probably would be inappropriate for me to do that. and also, i should note, robinhood wasn't the only firm to restrict buying in securities, other brokerages have been restricting the buying and trading of these types of securities all week. and even today of course we

. >> reporter: but robinhood's ceo vlad tenev denied any foul play.g the move was aimed at the protecting the firm and its users. >> we absolutely did not do this at the direction of any market maker or hedge fund or anyone we route to or other market participants. >> reporter: lawmakers from democrat alexandria ocasio-cortez to republican ted cruz have blasted robinhood over its gamestop trading freeze. >> i think the forces that regulate the market, whether congress, more importantly theh s.e.c. and the exchanges, need to understand these dynamics. >> reporter: jacob frenkel is a former s.e.c. lawyer, he doesn't think new regulations are required but believes the industry must adjust to its new reality. what does it mean for the future of trading? >> it means that the sec and the markets in some respects need to recalibrate. the markets are looking at something they've never experienced before. >> reporter: robinhood will continue to monitor the situation and make adjustments as needed. with the high volume of trades and cash, gamestop raised more t

i want to bring in the ceo of robinhood, vlad tenev is with us right now.te you joining us on a day where there are so many questions. and as melissa just said, there are frankly as you know a lot of angry customers out there and a lot of questions about what took place and the decisions that you made to limit so many of your customers' ability to buy stocks like gamestop. questions about whether you have a liquidity problem, whether you're trying to protect them from themselves, whether citadel did this explain what happened today. >> thank you for having me on the show again, andrew so what happened today was as you pointed out, we had to make a very difficult decision. it's been a challenging day. we made the decision in the morning to limit the buying of about 13 securities on our platform so to be clear, customers could still sell those securities if they had positions in them and they could also trade in the thousands of other securities on our platform so it was a difficult decision and that's what we had to do as part of normal operations. >> but ex