The recent Robinhood trading suspension has sparked significant attention as the platform halted its 24-hour market execution venue, Blue Ocean ATS.
On August 6, the Robinhood app suspended Blue Ocean due to overnight trading on its platform. The trade began at midnight UTC and ended in the morning at 8 a.m. UTC according to the Robinhood support account which told X about the incident.
He further stated that people can still place an order and cancel it, but trades that took place at midnight will be routed for completion in approximately 8 hours.
Robinhood’s latest 24-hour trading pause followed another overnight suspension by BOATs the day before, with many users reporting the issue on August 5. This happened during a global stock market crash, where Japan’s Nikkei experienced its biggest drop since Black Monday in 1987.
When asked to the Robinhood about the pause in trading activity, a company spokesperson stated that they are currently operating. Robinhood’s 24-hour trading service was introduced in 2023, allowing customers to place orders anytime. For this, the company used BOATs to execute orders placed after traditional hours.
According to reports, BOATs use their “own risk controls to prevent stocks from trading more than 20% above or below the price established near the end of an extended hours trading session.” the company further added:
“Public exchanges have similar controls to prevent extreme price movements during market hours, including limit up and limit down halts […] This means individual securities in the 24-hour market won’t trade outside these pricing bands. BOATS may also reject orders with limited prices outside these price bands.
The social media reports identified that Robinhood is not the only platform experiencing the issue due to the unstable stock market. Other platforms like TD Ameritrade, UPS and CenturyLink, and Fidelity also experienced the same problem.
Robinhood trading suspension: Users express frustration over trade cancellations
In response to the Robinhood announcement on X, users complain publicly about their order cancellation. One of the Robinhood users Kyle Babbit posted on X, stating “What about my shares of Nvidia that I purchased last night, which were up nearly 10% before you clawed them back this morning?”
In response to this post, the company sent him an Email explaining that due to the BOATs error, all the orders placed during the suspension period were canceled.
Multiple users on U.S. regulations checked if the outrage was following the country laws. Another frustrated user posted on X asking Robinhood to provide a reason for the 24-hour blackout.
One investor alleged Robinhood for losing $500 due to BOATs error, stating the company has no record of the purchase during this suspension phase.
“I wonder what FINRA would have to say about stealing my profits,” the user said.
