Robinhood moved to restrict users from hastily buying cryptocurrencies Friday as the prices of two popular digital coins surged.
In a post on its website, Robinhood said it temporarily disabled “Instant Deposits” for cryptocurrency purchases. That means users won’t be able to buy digital currencies with money they add to their accounts until the deposit settles, which could take up to five business days.
Robinhood imposed the restrictions amid massive rallies in both Bitcoin — the world’s biggest cryptocurrency — and Dogecoin, an alternative coin based on an internet meme that started as a joke.
Dogecoin’s price had spiked by more than 348 percent to roughly 5 cents as of 8:35 a.m. thanks largely to a Reddit forum that’s been pumping it up — just like a message board has caused GameStop’s stock to explode.
Bitcoin, meanwhile, was recently up nearly 20 percent at $37,566.14 after Tesla CEO Elon Musk mentioned the cryptocurrency in his bio on Twitter, where his posts are known to move markets.
Robinhood did not immediately respond to a request for comment. But a spokesperson for the startup told CNBC that it turned off the “instant buying power” feature for cryptocurrencies “due to extraordinary market conditions.”
“Customers can still use settled funds to buy crypto,” the spokesperson told CNBC. “We’ll keep monitoring market conditions and communicating with our customers.”
Dogecoin has become the favored cryptocurrency on Reddit’s “SatoshiStreetBets” message board, a hub for crypto traders named for Bitcoin’s pseudonymous founder, Satoshi Nakamoto.
Users on the site talked about pushing the price of a single Dogecoin up to $10 — which would be a massive feat given that it was worth barely more than a nickel even after Friday’s surge.
Musk added fuel to the fire by tweeting a fake magazine cover for “Dogue,” a dog-themed sendup of Vogue. The SatoshiStreetBets crowd took that as a sign that Musk supported their efforts to boost Dogecoin’s value.
“Elon heard us,” user AbduMad wrote on the message board on Thursday.