Trading app Robinhood experiencing 'major outage' for a second day amid heavy volume market action

Robinhood reported technical issues for a second day following an outage that kept clients from trading on a historic market rally.

As U.S. stocks traded actively again Tuesday in wake of a surprise Fed rate cut, Robinhood reported a “major outage” for trading across its platform. Earlier updates on the site said that all trading was “operational,” but Twitter users posted screenshots of error messages as U.S. markets opened Tuesday.

“We are experiencing a system-wide outage,” a message on Robinhood’s website read. 

Technical issues began Monday morning and lasted throughout the trading day, leaving users with their hands tied as the Dow Jones Industrial Average’s biggest one-day point gain in history. On Tuesday, stocks surged off their lows after the Federal Reserve cut interest rates in an effort to stem slower economic growth from the coronavirus outbreak.

Robinhood had said in a statement Monday evening that the platform was “back up and running” and that they were “testing through the night, and may observe some downtime as we prepare for Tuesday.”

“We realize we let our customers down, and we’re committed to improving their experience,” the company said Monday. 

Many of Robinhood’s 10 million users took to Twitter and Reddit to blast the start-up. Some said they would leave the platform, while others threatened a class-action lawsuit.  

A Robinhood spokesperson said the outage was caused by “infrastructure that allows our systems to communicate with each other.” That resulted in outages across other services, “preventing customers from using our app, website, and help center,” according to the company. 

As far as compensation, spokesperson said Robinhood was reaching out to customers on a “case by case” basis. 

The company was last valued at $7.6 billion after a Series E funding round last year led by DST Global. Venture capital firms like New Enterprise Associates (NEA), Sequoia and Ribbit Capital are also investors. Robinhood ushered in millions of millennial traders by offering free equity, options and cryptocurrency trading.

— CNBC’s Maggie Fitzgerald contributed reporting.

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