They weren't. IB halted options but the actual stock GME kept trading. I myself made a buy/sell order on TD Ameritrade in that time period and I got the receipts to prove it.

It was just a few exchanges: Robinhood and some other one, that turned off GME buys.

> Could Robinhood have disabled margin accounts and only allowed people to purchase with settled cash as a way to keep the margin requirements in check?

No. Because it takes 2 days for funds to settle, and Robinhood couldn't afford to get any more stock from their partners.

You understand that when you buy a stock on Robinhood, Robinhood has to _FIND_ that stock for you from somewhere, right? Generally speaking, it is from a seller somewhere else. If those sellers aren't giving Robinhood any shares, then Robinhood can't give any shares to their customers.

> It seems big money was conspiring against retail and makes it difficult to trust the current opaque system.

It was Robinhood's fault for not having enough collateral, and it was Robinhood's customer's fault for placing their trust in such a crappy company.

This wasn't the first time Robinhood screwed things up, and it won't be the last.

b) Robinhood was "blocked" because it decided to not do any serious risk management. And by blocked we mean it didn't have the cash that the clearinghouse required to service them.

c) No the collateral is for the clearance. The margin you refer to is what Robinhood lends you the customer. They are handling (mishandling in the case of Robinhood) their own equivalent side to be able to provide you with those stock trades.

What you see as a successful trade is only the execution of the trade -- that is someone has agreed to buy or sell at the price you asked/bid for. Next someone (broker + clearing house) needs to clear (Robinhood fucked up here) and then needs to settle. The clearing house takes the risk in case one of the counterparties falters or becomes insolvent, to ensure transactions do happen. It takes 2 days to trade (execution to settlement) non-options in most systems I am aware of these days.

c') Robinhood was just blind sided when its clearinghouse said "Hey, you know you actually just have way more buys that are more volatile than normal to the point of issues at clearing is 1, so increase your collateral." Robinhood said:"No money." Clearinghouse: "No worries, no trades, until you change your risk profile."

(Here is a quick link (just googled, couldn't find a better article I like) outlining the process https://thismatter.com/money/stocks/settlement-and-clearing.....

P.S. (@Edit): Also the brokers can not legally touch the customers' "hard cash" money and post it to cover their own obligations -- that would be commingling and let us say it is not good. I am not going to even begin imagining the issues, but people continuously get screwed due to commingling of funds.