The price dropped because there was no buying pressure (speculation of players shorting the stock at the top aside). Disabling the ability to buy in several brokerages removes the price discovery aspect of the system.
The price dropped because it is in an insane bubble at the moment. Whether that drop would have happened today or some other day without RH's actions is unknowable. But if a lesser drop still did happen today and people couldn't sell their positions, that would have been even worse for users.
> The price dropped because there was no buying pressure
Robinhood is not the entire market. I don't know what the exact number is, but I doubt they're even a material number of the entire stock market.
If Robinhood is the entire buying market, to the point that Robinhood pausing buying is detrimental, then how does that not make it clear that this entire situation is setting up Robinhood users to lose everything they buy?
Robinhood was not the only firm blocking buying new positions. Schwab did, TD Ameritrade did, and ETrade did, IBKR did for varying lengths of time. That is the majority of retail.
Here is a fascinating interview with the CEO of IBKR where he literally says they prevented buying for retail and closed large short positions for others:
https://streamable.com/ycdec9
