Traders hoping to wake up to a return to some form of normalcy might have to wait until next week after Robinhood is temporarily suspending a popular feature among its cryptocurrency users.
What Happened: Robinhood users reported early Friday morning they couldn't use instant deposits for crypto purchases. This means that users can only buy cryptocurrencies with cash that was already deposited in their accounts.
Robinhood's Instant Deposits feature fronts customers up to $1,000 until their pending deposit clears.
"Due to extraordinary market conditions, we've temporarily turned off Instant buying power for crypto," a Robinhood spokesperson told CNBC.
Customers can still use the cash already settled in their account to trade as normal.
Robinhood's decision immediately follows an 800% surge in the digital "doge" coin. The coin was created as a joke and trades in the pennies.
Why It's Important: Robinhood, the popular trading app that shocked many users by heavily restricting trading of GameStop Corp. GME and other stocks on Thursday, is making headlines again. But this time around the reaction is mixed.
Some users on Twitter note customers are restricted from using borrowed money to place trades and have full access to their cleared cash.
To start FRI 29-JAN-2021 @RobinhoodApp #RobinHood isn't allowing Instant Access to Deposits FOR CRYPTOS only...liquidity is a significant issue for any FI...this is understandable, just don't block retail investors from buying securities with their available cash plz TIA pic.twitter.com/M0DxdQG51j— Screaming Lincolns (@ScreamLincolns) January 29, 2021
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