tl;dr
Citadel Securities (market maker) received outside funding for the first time in the amount of $1.15B; Paradigm is a Web3/crypto-oriented firm, so there's a strong likelihood that Citadel Securities will expand by becoming a crypto market marker
Edit2: recomposed the tl;dr and incorporated original tl;dr into the Preface.
Preface
I've seen too many posts/comments today that seem to think the hedge fund is getting propped up, which is incorrect. What's truly insightful is the why this investment was made in the market maker side of Citadel. While the two "Citadel" entities are synonymous due to ownership, they are distinctly different and not interchangeable in discussion. So after a year of us all being here, the following links are for the uninitiated:
https://en.wikipedia.org/wiki/Citadel_LLC
https://en.wikipedia.org/wiki/Citadel_LLC#Citadel_Securities
Edit3: if you want the entire mouthful, it's Citadel Enterprise Americas, LLC (formerly just Citadel LLC).
Insight: the WHY of it
Here's a Wall Street Journal (WSJ) article that offers insight as to why these firms have invested in Citadel Securities.
https://www.wsj.com/articles/citadel-securities-to-receive-first-outside-investment-11641905101
Those who have been keeping their ears to the ground might find the following quotations of interest:
>Venture-capital firm Sequoia Capital and cryptocurrency investor Paradigm have agreed to invest $1.15 billion (in Citadel Securities)...
>
>Paradigm is focused on crypto and Web3, a reimagining of the internet, areas Citadel Securities is likely to incorporate in the future as they become more regulated.
Now ask yourself: am I aware of a company that's currently pursuing a Web3 and crypto-backed NFT marketplace? Is there a certain DEX that has long been rumored to be partnering with GameStop?
*Edit6: Web3+NFT link above swapped out for G
... keep reading on reddit β‘
0. Preface
I'm not a financial advisor and I do not provide financial advise. I am snake. And, I am retard who is wrong all them time so why are you even reading this?
Edit: Please read this thread instead for clarification:
https://www.reddit.com/r/Superstonk/comments/qvtmxm/clearing_up_some_things_about_options_and_how_it
Edit: β οΈ It is universally agreed that OTM calls will directly fund the SHFs and MMs, so they should be avoided like the plague.
It should also be noted that weekly and short-term options are extremely risky as well. These can also be feeding the SHFs and MMs due to theta decay or from a quick flash crash in the price which will drop even ITM/ATM options to become OTM. Go read (or listen to) actual options DD by other users such as /u/gherkinit before making any decisions.
YOLO on $950Cs 0DTE. Just kidding please don't
1. Options
Apes. We need to start talking options. The SHFs are scared of them. Or more particularly, Citadel is scared of them.
Every person I talked to who actually understands options knows that it is (pretty much) the only way to induce volatility in stocks, and they all agree that it can be additional pressure on the SHFs + MMs. Why is it spooky to them? A little friend called leverage.
Ask yourself this: What two main topics have been suppressed ever since January? Direct registration and options. Both with pretty weak ass counter-arguments. It took apes until September to break through and see the DRS way. Now it's about time to break through and see the options way. For some of us at least. Options are not for everyone. But, there's some intro posts for you if you're still curious such as /u/DigitInoize's introduction post.
Think about it. What is the typical message that gets echoed back when anyone talks options? They say, "you're just funding Kenny and his friends!". There's nothing else. No discussion on the actual effects that options have on the market, and no discussion and delta hedging. Give that narrative enough time to push around Reddit, and everyone starts echoing it back and forth that options are pure taboo.
Just. Like. DRS.
~~The topic of DRS was taboo for almost 8 months and now the front page is filled with DRS posts. That
... keep reading on reddit β‘
Title. While quant traders are well compensated, they don't enjoy title bumps and career progression that people at FAANG have. I have heard that people end up retiring in 30s or work as a quant trader until the end of their careers. What happens to the more ambitious people?
TLDR:>!Senator Pat Toomey of Pennsylvania appears to be motivated by S.3102 - Investor Freedom Act of 2021 passing. Following his tenure as a Senator, Toomey will likely be returning to his previous role as a derivative trader; swaps.!<
>!Short Sellers greatly profit not only from PFOF, but also swaps transactions. Citadel made $841M in Fiscal year 2020 from activities that include swaps.!<
Tinfoil TLDR:>!Is Pat Toomey proposing new legislation now, so that when he is no longer in office, he can make millions off of swaps and other derivatives for and/or with an institution that engages in PFOF.!<
Senator Pat Toomey has introduced a new bill--S.3102 - Investor Freedom Act of 2021--purpose is to "amend the Securities Exchange Act of 1934 to preserve commission-free trading and investor freedom for the people of the United States by prohibiting the Securities and Exchange Commission from banning payment for order flow, and for other purposes", was introduced and sponsored by current sitting Senator Patrick Toomey of Pennsylvania.
https://preview.redd.it/9s8b2adae0881.png?width=1119&format=png&auto=webp&s=4dbf537bfa9845fe8d93cadfcb10694cebea4de0
You might be asking yourself "Why is Toomey care about payment for order flow (PFOF)" ?
After Senator Toomey completes his 18 year tenure in office, he will like be returning to his profitable past. In an NPR article, Toomey mentioned "my plan is to go back to the private sector", when discussing his post-Congress intentions.
I think this statement is key. Toomey doesn't just say "my plan is to go to the private sector", but instead, to "go back" to it.
What did Pat Toomey do in his past?
For this answer, we turn to an August 2020 release; DSCC INTRODUCES WALL STREET DERIVATIVES TRADER PAT TOOMEY TO PENNSYLVANIA IN FIRST TV AD: βDEALERβ Millionaire Pat Toomey Has Fought For Wall Street Over Main Street For Decades, Praised Derivatives As An βEnormous Goodβ.
This release sets out to paint Toomey in a negative light, and provides their evidence for why Toomey is "Is Wrong For Main Street Pennsylvania", as he has "decades of service to Wall Street". This press release lists former National Press Secretary of the Democratic Senatorial Campaign Committee (DSCC) as the
... keep reading on reddit β‘Citadel Securities valued at $22 billion after investment from Sequoia, Paradigm
https://www.sequoiacap.com/companies/reddit/
Sequoia is a Private Equity firm, they had / have stakes in a tonne of businesses, including:
- Nubank
- DoorDash
- Snowflake
- Apple
- FTX
- AirBnB
- Stripe
- Okta
- Square
- Unity
At first sight, this really doesn't bode well for Reddit and this sub in particular.
i. Foreword
^(I am not a financial advisor. This is not financial advice. What you may read is for informational purposes only. Confirm the validity of this information if you do decide to make decisions after reading this.)
https://preview.redd.it/elyii6jjga681.png?width=1280&format=png&auto=webp&s=8c367f4f6f081b2d10f2d0be8a09fb39fc6cb2f4
ii. Introduction
This post is a collection of research I've conducted since January. I've been motivated to connect the puzzling pieces that "control" everything related to AMC. Much of this information was talked about almost a year ago, but I'm creating this post to reiterate some important topics about AMC. I will not be creating a TLDR (Sorry Lazy Apes) simply because I think it's important to understand all of this to know why the price says what it is.
This entire post explains: the power Citadel has with HFT's, how FTD's are hidden, how ETF's are abused for profit, Blackrock's recall scenario, and how borrowed time is almost up delaying MOASS.
You'll earn some wrinkles from this post. The more you know, right?
iii. Contents
- Who is Citadel?
- Who is Blackrock?
- Apes Vs. The World
- High Frequency Arbitrage
- Synthetic Positions Hide FTD's
- Blackrock Pokes the Bear
- Borrowed Time
- Epilogue
I. Who is Citadel?
^(The bad guys.)
Citadel is a Market Maker[MM] AND Authorized Participant[AP] AND Broker-Dealer[BD] AND Hedge Fund[HF]******.
As an AP, this means they have a right to create and redeem shares of an ETF. When there is a shortage of ETF's on the market, they can MAKE MORE. They can also DELETE shares in the float when the price of the ETF is lower than the price of underlying shares. As a MM, they oversee bid/ask prices to create a tight spread. Citadel's goal is to take your money.
Citadel clearly has no conflict of interest. The SEC designed their playbook they've been using far beyond 2008. The market we've been using since is designed to be liquid, so liquid it makes the most profit off of fast dips and fast rips. Citadel is short on everything because their goal is to buy lower than the requested order. This gives them every incentive to drive the price closer to $0 with every trade. They make money on companies dying with high frequency trading, d
... keep reading on reddit β‘Recall all those damning Robinhood and Citadel emails that were released in the short squeeze litigation? That happened September 22, 2021: https://storage.courtlistener.com/recap/gov.uscourts.flsd.590042/gov.uscourts.flsd.590042.416.0.pdf
Gary Gensler's September calendar was released a few days ago: https://www.sec.gov/foia/docs/secchaircalendar/chair-gensler-public-calendar-2021-09.pdf
Guess who he met with on Tuesday, September 28, 2021?
When was the SEC's Gamestop report released? October 14, 2021. https://www.sec.gov/files/staff-report-equity-options-market-struction-conditions-early-2021.pdf
https://preview.redd.it/tx3th6ellm181.png?width=655&format=png&auto=webp&s=d2cac4b85971d2aca19042c6934a8d4aa0731f7c
Does anyone seriously think the emails, turning off the buy button, etc., were not discussed?
Here's an email where they are monitoring Reddit. Gensler, how are you protecting the retail investor here? What the fuck did Vlad & Co say to "persuade" Gensler to turn a blind eye to this stuff?
There's other red flags in Gensler's calendar to look into... meeting with Virtu, JP Morgan, Wells Fargo, various congressmen, a Citadel employee with a bunch of other lobbyists... too mad right now to look into it, this shit makes me sick.
Buy, hodl, DRS ππ¦ππ
Edit: I sent a FOIA request this morning (11/25/2021) for any minutes, notes, transcripts, recordings and documents related to this meeting. Will keep you all posted. Happy Thanksgiving apes.
I made this observation today when I looked up the article. They basically said that Citadel was the #1 Hedge fund betting against GME. They brought up Robinhood and how it was thrown out in court that they colluded with citadel. They also had the tweet from Citadel about the apes being frustrated that he and Vlad had never met. forget the exact wording because I hate that piece of shit (after sleeping on it, I'm better than that. Merry Christmas Kenneth). Thought the change was funny, and obviously someone got yelled at. It was #1, why not bump it to #2 or #3... They changed it to
#3: Hound Partners LLC
This New York-based hedge fund currently manages around $3.2 billion in assets for 13 clients. The fund has 209,100 put options on GME shares, which accounts for nearly 2% of the Hound Partners portfolio.
Since entering its GME position in the first quarter of 2021 -- right after the stock's huge rally -- the fund has liquidated 28,800 put options from its original position (237,900 put options). The hedge fundβs biggest positions are currently Vanguard S&P 500 ETF VOO and Microsoft MSFT, which account for 15% and 7% of the portfolio, respectively.
#2. Twin Tree Management LP
This fund from Dallas, Texas has $3.8 billion of assets under management and started to bet against GameStop stock as recently as Q3 of the current year. The fund has 253,700 put options on GME, at a market value of $44.5 million. This figure represents a small portion of less than 1% of Twin Treeβs assets.
Interesting to note, nearly 20% of the portfolio's AUM are placed on a bet against the SPDR S&P 500 ETF TrustΒ (SPY) - Get SPDR S&P 500 ETF Trust ReportΒ via put options β although the fund also has 7% allocated to SPY calls.
#1. Prelude Capital Management LLC
Based in New York, Prelude Capital currently has nine clients and $8.1 billion in assets under management. The hedge fund has a short-selling bias, and the top three positions in its portfolio are Chesapeake Energy CHK puts (10%), SPDR S&P 500 ETF Trust SPY puts (9%), and Tesla TSLA puts (6%).
Prelude Capital has 2% of its portfolio in GameStop puts. This accounts for 46
... keep reading on reddit β‘
After hearing this morning's news about Sequoia and paradigm's sizeable $1.5B investment into Citadel, the red flags immediately went up, and I thought "there has to be more to this", and started digging. Two hours later and I think I have found what could be some interesting developments that could be coming from the Chicago-based hedge fund led by Ken Griffin.
TLDR: >!It is my hypothesis--after conducting some research and coming across some compelling evidence and documentation, albeit somewhat speculative in nature--that Citadel is looking to go public, as well as enter the crypto, blockchain, and NFT space.!<
Bonus TLDR/TinFoil [Maybe]: >!Is YouTube part of this play, somehow?!!<
https://reddit.com/link/s1miz7/video/8sbtud1zr3b81/player
With that said, "Let's dive in", as Simulate & Trade would say.
The two Bloomberg articles below both reference-- or hint to, rather--the potential of a Citadel Securities Initial Public Offering (IPO), which I think would be in the nearer future, as opposed to farther out.
https://preview.redd.it/6c7a6m56u3b81.png?width=745&format=png&auto=webp&s=4914358a491abe9fe3ae45f975b29f4cdc90c19f
https://preview.redd.it/p8gnr1f7u3b81.png?width=545&format=png&auto=webp&s=93f47eae7ce6970a363153a3f85b70f3931802e5
"Who are Sequoia and Paradigm, anyway**? And why do** I care?", you may be asking yourself. Great question.
Sequoia Capital is a California-based venture capital (VC) firm, where Alfred Lin--who will be joining Citadel's Securities' board--is a partner.
"Who is Alfred Lin?", you may also find yourself asking. Another great question.
Alfred Lin is a Harvard alumn, where he earned a BA in Applied Mathematics. Lin is the former VP of Link Exchange (which was later acquired by Microsoft), and former Chairman and COO of Zappos (which was later acquired by Amazon). In addition to these successes, Lin has been a member of the Board of Directors of such names as
- Shopular (Acquired by Ebates); Jan 2015 β Mar 2016
- Humble Bundle; Apr 2011 β Nov 2017(Humble Bundle is a distribution platform selling games, ebooks, software, and other digital content)
- Sella & Dot; Nov 2010 β Mar 2020
- Door Dash; May 2014 β Present
- Airbnb; Nov 2012 β Present
According to [Wikipedia](https://en.wikipedia.or
... keep reading on reddit β‘
TL;DR - Paradigm are a Web3/Crypto venture capitalist business. Merely looking at their holdings show they are a serious player in the game. Their knowledge with the funding from Sequoia show just how desperate Citadel are to be a player in a potential new De-Fi stock exchange.
Hello. I want to just say I am very rusty at this, and it's been a while since I released any DD. The DD just doesn't hit as hard as it used to.
Maybe we're drowned out by DRS posts? (lmao don't get mad, I love your purple rings)
Maybe we're just so used to the fuckery that it really isn't special any more.
Maybe I'm just r*tarded.
I have always maintained that you bunch of apes should be more diligent in believing MSM. It seems the critical thought regarding this has started to fade and the second we see a news article it's taken as gospel. (begins to contradict oneself and write a DD on the exact thing. Yeah yeah, I'm aware but I'd just like to ponder the outcomes ;) )
That said. LETS BEGIN.
________________________________________________________________________________________________________
Putting the links together
I'm not going to sit here and make comparisons of this situation to GameStop because quite frankly, I don't know GameStop's plans or how huge they will be. That's not to say they won't be big, but you know I'm going to be speculative at best.
Paradigm. A behemoth in the Web3 and Crypto sphere. Let's put the links together. In fact, Paradigm did it for me!
https://www.paradigminvest.xyz/Paradigm_Business_Overview.pdf
Matt Huang - Former partner at Sequoia. Obvious link.
Alana Palmedo - Chief Marketing officer at Paradigm LLC - THE INVESTMENT OFFICE FOR BILL AND MELINDA GATES.
Lmao bill. You fucked aren't you. Like you uber fucked. Like, Bill give Citadel money probs. Whodda thought.
Now I appreciate running on a tiinnyy bit of text that mentions them is a stretch for a heap of DD. I understand that. Though I also believe that this may have been a little slip up and not meant to be as publicised as they would've liked either. I haven't been able to find any further links to this though, I urge you all to help me dig. This isn't over.
________________\
... keep reading on reddit β‘Everyone's talking about the $1.2 Billion bailout of Citadel by Sequoia like Ken Griffin's personal genius somehow seduced "visionary silicon valley gurus" at Sequoia, and earned him $1 billion worth of investments -- ie, "it's not really a bailout it's merit-based partnerships" according to the media (owned by Citadel).
The media is avoiding the subject of Sequoia's hedge fund Sequoia Heritage that bailed out Melvin Capital last year, or their other investments (like Robinhood) that Citadel was already neck deep in. It seems more like they're just moving money around within the same informal partnership, not "investing" in distant peers as the media portrays it. It might also be a screen for more nefarious shell games.
From Business Insider last February, a reminder of how incestuous these scumbags are:
>As an army of retail traders took on some of Wall Street's biggest names, one of Silicon Valley's most storied investment firms found itself with money on both sides of the trade.
>
>The conflict played out inside Sequoia Capital, the venture-capital firm founded in the early 1970s by one of the original entrepreneurs of the silicon chips that gave the California valley its name. Sequoia grew into an industry legend as an early investor in such technology behemoths as Apple, Oracle, and Google.Β
>
>More recently, the company has been a significant but passive backer of the Robinhood trading app used by many retail traders to place bets on a series of out-of-favor stocks. One of those, the video-game retailer GameStop, surged more than 1,600% last month, catching a number of well-pedigreed Wall Street hedge funds in a short squeeze.
>
>Less well-known is that Sequoia had an investment in one of those very hedge funds, thanks to a little-known investment fund that manages the fortunes of Sequoia's partners.Β
>
>Their involvement began in 2014, when Gabe Plotkin *was a rising star thanks to his work for the industry titan Steve
Link: https://www.sec.gov/rules/concept/s70704/citadel04132004.pdf
April 13, 2004
Mr. Jonathan G. Katz
Secretary U.S. Securities and Exchange Commission
450 Fifth Street NW
Washington, DC 20549-0609
Re: Release No. 34-49175; File No. S7-07-04 β Competitive Developments in the Options Markets
Dear Mr. Katz:
Citadel Investment Group, L.L.C. (βCitadel Groupβ) welcomes this opportunity to comment on Commission Release No. 34-49175 (the βReleaseβ). The Release discusses recent changes in the listed options markets and seeks public comment on whether the Commission should take action to improve efficiency and competition in these markets.
Volume has increased in listed options markets in recent years due to improvements in liquidity, transparency, and competition in these markets. The ability of investors to efficiently use the listed options markets is an important cornerstone of our national market system. It is thus crucial that the Commission implement reforms that will further this trend. Specifically:
β’ The firm quote rule would best serve liquidity and transparency if it applied to all listed option order types up to the displayed size of any quote.
β’ The practice of payment for order flow creates serious conflicts of interest and should be banned.
β’ Internalization without meaningful price improvement reduces competition, limits price discovery, leads to market fragmentation, and should be banned.
β’ The Commission should not yet require the listed options markets to quote in decimals because decimalization would overload systems already pushed to their limits and lead to less transparent and shallow markets.
Citadel Group welcomes the issuance of the Release and the Commissionβs other efforts to consider and open for discussion fundamental issues relating to market structure and regulation. The Commissionβs willingness to focus on these difficult issues and ask the hard questions works to ensure that the U.S. markets remain the strongest and most efficient in the world.
I. Citadelβs Activities and Interests
Citadel Group and its affiliates have approximately 700 employees, with headquarters in Chicago and offices in New York, San Francisco, London and Tokyo. Citadel Group provides administrative and investment-related services to a number of private investment funds and investment vehicles. Citadel Groupβs affiliate, Citadel Limited Partnership (β
... keep reading on reddit β‘
Too Ape To Read It All (Please do read it all)
TLDR
A) Melvin got bailed out by Citadel and Point 72
B) Now Citadel is getting bailed out by Amazon and Google, via Sequoia (a VC that has NEVER invested in a Hedge Fund before this). Sequoia only invests in technology Companies
C) The connections are crazy - Jeff Bezos in first batch of Angel investors in Google, Kleiner Perkins first VC for Google, Kleiner Perkins business partnership with Amazon since 1996, SEquoia funding Square (Jack Dorsey Twitter), Sequoia investor in Instagram and WhatsApp (both sold to Facebook/Meta)
Amazon and SEquoia are trying to save SOMEONE's ASS
Whose?
Read on and connect the dots ...
...
************* Full Version
There has been lots of great DD about Amazon working with Short Hedge Funds to attack its competitors
--> https://www.reddit.com/r/Superstonk/comments/np33hr/amazon_bain_capital_and_citadel_bust_out_the/
How does this relate to Citadel getting funded by Sequoia?
News -> https://www.ft.com/content/188afc27-5c08-4b06-b066-d79522ed787e
Key: Sequoia and Paradigm bought a $1.2 billion stake in Citadel Securities from Ken Griffin
at a $22 billion valuation
Last year Citadel Securities was valued at $36 billion
a large round at a significantly lower valuation, at a time when valuations are crazy high (Open Sea valued at over $10 billion) indicates Citadel was somewhat desperate for cash
Why Sequoia?
Sequoia invests mainly in technology companies
Its list of investments include -> https://www.sequoiacap.com/our-companies/?_spotlight=1
That's Apple, FTX (another link), Airbnb, Square (Jack Dorsey of Twitter), Instagram (since acquired by Meta FacePalm), WhatsApp (since acquired by Meta FacePalm)
Do we see any Financial Companies? Any Hedge Funds? NONE whatsoever ... until Citadel
The list of companies short attacked by Short Hedge Funds is pretty much a list of companies Amazon considers a threat (GME, Wishful, NewEggHeads, SearsInc) or companies in areas Amazon wants to take over (MovieStock, Blockbuster, etc)
It also extends to attacking (in theory) Bezos' space rivals - With Virgin Galactic and Tesla also, at times, being heavily attacked by short seller
It is also speculated that
... keep reading on reddit β‘DRS. DRS.DRS. DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS.DRS. DRS. DRS. GME.
