Trading 212, a fintech company and FCA-regulated broker, has temporarily halted the on-boarding of new users. Retail platforms are under pressure to keep up with the huge growth in retail investing, which is causing severe operational difficulties.
Trading 212 said new account creation would be enabled only after processing the existing applications currently in line. The London-based fintech was one of several platforms, including Robinhood and IG Group, that experienced outages as the number of retail trades soared in a wild day for the markets.
However, no other brokers announced the immediate suspension of client registration. Etoro reported earlier similar difficulties with handling the massive influx of new business, but that did not result in a halt of new sign-ups.
“Due to the unprecedented demand, we have temporarily stopped onboarding new clients. Once we process the existing queue, we will be open for new registrations. We apologise for the caused inconvenience and highly appreciate your understanding,” Trading 212 said in a statement.
The platform announced in a tweet that its mobile app had crashed due to the surge and warned users of service disruption and “login connectivity issues”. About an hour later, it tweeted the problem had been resolved and apologized to customers for the inconvenience.
Rob Frasca Talks Ndau as an Adaptive Store of ValueGo to article >>
“Our intermediary is experiencing difficulties in transmitting orders. Existing orders might be executed with a delay. Placing new orders is currently not possible,” the company said earlier in an update on their website.
The service disruptions and new restrictions have come during a period of frenetic trading, where Reddit users were accused of inflating the price of GameStop, AMC, Blackberry, Nokia and other stocks. The trading platforms’ problems largely stem from Reddit’s WallStreetBets crowd, sought to punish the hedge fund’s betting against GameStop.
Retail platforms have halted trading, experienced outages, and crashed during periods of high volumes as a result. Part of that pressure has been driven by thousands of new amateur investors.
Other brokers have moved to curb trading of these shares by varying restrictions, depending on the security, such as limiting leverage levels, banning short sales and increasing margins to stop the Reddit investing frenzy.
The incident at Trading 212 counts as the third confirmed system outage so far in the last three months. Earlier, the retail broker said it came under distributed denial-of-service attacks, or DDoS, that attempted to paralyze its system with a flood of information.