Reddit is now involved in a lawsuit claiming that bots and foreign entities had a hand in the r/WallStreetBets subreddit which contributed to the almost 400 percent rise of GameStop's stocks early this year. The Reddit CEO has clarified that there has been no evidence of that allegation and would be testifying in front of Congress to defend the platform.
WASHINGTON, DC - OCTOBER 16: Reddit Inc. co-founder and CEO Steve Huffman looks on during a hearing with the House Communications and Technology and House Commerce Subcommittees on Capitol Hill on October 16, 2019 in Washington, DC. The hearing investigated measures to foster a healthier internet and protect consumers.
The popular social networking platform and forums, Reddit, is now caught in the crossfire of a massive allegation that alleges its ties to a bot that helped in the stocks and earnings of GameStop in a community. The social network forums and platform contributed a massive deal to the rise of GameStop in the market, which is now valued as a multi-billion company.
The lawsuit comes after the Robinhood application which temporarily restricted trading on the application, after the massive growth of GameStop's stocks, to meet certain conditions it is under. Now, a lawsuit has been sent to the House of Representatives' Committee on Financial Services to look into Reddit's contribution to the matter.
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Reddit CEO Would Defend the Social Network and WallStreetBets in Congress
According to the documents from the Congress' lawsuit probe, Reddit CEO Steve Huffman would be defending the name of the company and the WallStreetBets community as it had done nothing to violate laws. Huffman would be mentioning his prepared statement regarding the connection of Reddit bots in r/WallStreetBets, which is nonexistent.
The Reddit CEO's planned statement reads that there are no bots that contributed or were part of the boost in GameStop's stocks which took place in r/WallStreetBets. Moreover, Steve Huffman also clarified that there were no pieces of evidence that foreign entities or bad actors were part of the processes and events that transpired in the subreddit.
Reddit's CEO claims that they have checked "every metric" in the social network platform, particularly in r/WallStreetBets, and discovered nothing out of the ordinary and within the normal parameters. Moderation tools in the community and the platform was also working and have been present during the times when the trades happened.
Reddit CEO would be Testifying with Robinhood and other Entities
According to CNBC, The Committee on Financial Services probe called upon the Reddit CEO, alongside Vlad Tenev, CEO of Robinhood App, Kenneth Griffin from Citadel, a Redditor called u/DeepF*ckingValue Keith Gill, and Gabriel Plotkin from Mervin Capital Management.
Steve Huffman even went as far as to mention that he is proud that these traders and the early event of 2021 in stock trading happened on the social networking and forum platform. The subreddit is also said to uphold "fairness and opportunity" in the country's financial system, particularly in stock trading.
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Written by Isaiah Alonzo
