> IB's CEO Thomas Peterffy said on CNBC that their intent was to protect large market participants, including clearing houses. This is the same thing I'm talki

> IB's CEO Thomas Peterffy said on CNBC that their intent was to protect large market participants, including clearing houses. This is the same thing I'm talking about, just arguably phrased poorly. If the clearing house is in danger you risk cascading financial failure that endangers everyone, not just people buying GME. Yes that includes large market participants but it also includes Joe Blow holding AAPL or TSLA. There is a conversation worth having about DTCC's potential conflicts of interest, but it seems clear to me that DTCC cannot be allowed to go down. They need to raise collateral requirements, regardless of the PR fallout that small brokerages might face. > The article you cited quotes the WeBull CEO saying that Apex dictated restrictions on specific stocks. That is at odds with the story that it was just a matter of brokers not being able to meet collateral requirements. I think being careful with terminology is important here. WeBull is what's known as an "introducing broker". They deal with clients through their app and such, but they don't really do any of the back-office work. They offload that to a clearing _firm_ called Apex, who ultimately is the one that must post collateral to the clearing _house_ DTCC[1]. According to WeBull's CEO, Apex realized they would be unable to put up the collateral and so called up all the brokerages they work with to tell them that GME would be halted. Robinhood and most larger brokerages such as TDA, Fidelity, and Vanguard are all self-clearing. It's essentially like if WeBull and Apex were the same company. So while technically speaking it was the clearing firm portion that couldn't post collateral, the introducing broker and clearing firm are the same company so people tend to just simplify and say that the brokerage itself couldn't meet collateral requirements. > One consistent theme seems to be that clearing houses are behind this, and that their restrictions were not dictated by a formula, but were more arbitrary. The clearing house (in the US, there's really only one) is definitely behind this, but I don't know that the restrictions were arbitrary. It's pretty standard practice for the DTCC to raise collateral requirements on volatile stocks, and they generally inform clearing firms until the morning that restrictions go into place, giving clearing firms only a few hours to provide additional capital[2]. Whether that's a good standard practice is certainly arguable. 1. See here for the difference between a clearing house and a clearing firm: https://www.money-zine.com/definitions/investing-dictionary/clearing-firm/ https://www.money-zine.com/definitions/investing-dictionary/... 2. See page 49 of https://dtcc.com/-/media/Files/Downloads/legal/policy-and-compliance/NSCC_Disclosure_Framework.pdf https://dtcc.com/-/media/Files/Downloads/legal/policy-and-co...