Us lawmakers are ready to grill Robinhood CEO Vlad Tenev over the GameStop trading frenzy at a Congressional hearing later today.

In his prepared remarks, Robinhood CEO appeared to identify responsibility for the platform's stock trading suspensions on the U.South. Securities and Exchange Committee. Tenev said that the visitor blocked trading to meet "regulatory deposit requirements" defined by the SEC. The exec specifically criticized an SEC dominion that requires equities transactions to clear over 2 days:

"It takes several days for the clearinghouse to process the transaction [...] This is known every bit "T+2" settlement, denoting the merchandise date plus a two-twenty-four hour period 'settlement catamenia.' This T+2 settlement bicycle is codified by SEC Rule 15c6-1(a), which prohibits banker-dealers from effecting the purchase or sale of a security afterwards than the 2nd concern day after the execution of the merchandise."

Tenev chosen on the authority to modify its trading rules to allow clearinghouses to support real-time settlement instead of a two-day settlement menstruum. "In that location is no reason why the greatest fiscal organisation the globe has always seen cannot settle trades in real time. Doing so would greatly mitigate the risk that such processing poses," he wrote. Robinhood previously released a blog post excoriating ii-24-hour interval settlement on Feb. 2.

In his testimony, Tenev besides referred to a January. 30 investor alert past the SEC that made it clear that broker-dealers had the right to turn down or limit client transactions for "legal, compliance, or take a chance management reasons."

Tenev also denied reports that Robinhood blocked trading at the asking of hedge funds, stating that whatsoever allegation that Robinhood acted to help hedge funds or other interests to the detriment of their customers is "absolutely false and market-distorting rhetoric."

Robinhood'south GameStop saga started on Jan. 28 when the company halted buying for GameStop stock and another shares that were allegedly pumped through the r/Wallstreetbets Reddit customs. Following trade restrictions, the customs speculated that Robinhood could take acted to protect the interests of hedge funds like Citadel and Melvin Uppercase at the expense of retail investors on Reddit.

Firm Representative Maxine Waters (D-CA) announced plans to hold a virtual hearing devoted to the GameStop saga in early Feb. The hearing is scheduled for 12:00 PM ET and volition also characteristic Reddit CEO Steve Huffman, Melvin Capital CEO Gabriel Plotkin and Citadel CEO Kenneth Griffin.