Retail trading was said to be a risk to markets during the GameStop saga, but the Archegos blowup has Reddit users pointing fingers back at Wall Street

• The hedge fund Archegos triggered $20 billion of selling Friday after failing to meet margin calls.
• The leveraged blowup has Reddit traders questioning who the real systemic risk is to the markets.
• Wall Street Bets and the retail-trading boom were said to be dangers to markets in the GameStop saga.

Retail traders on Reddit's Wall Street Bets forum took a lot of heat during the recent GameStop saga for coordinating on the forum to pump the price of their favorite stocks.

After the hedge fund Archegos' historic blowup at the end of last week on the back of leveraged stock bets, many on the platform are pointing fingers back at Wall Street.

In January, traders on Wall Street Bets began targeting stocks with high short-interest rates in hopes of driving a short squeeze and netting quick profits. The beleaguered video-game retailer GameStop became the group's favorite target.

After GameStop's share price soared, US regulators eyed whether the Reddit forum and its retail-trading members were part of market manipulation. The Securities and Exchange Commission and the Commodity Futures Trading Commission began reviewing traders' actions on forums like Reddit to see whether illicit activity took place.

European Union regulators said that the Redditors' actions "could constitute market manipulation" and that they would monitor the situation as well.

In an interview with CNBC on February 1, Democratic Rep. Stephen Lynch of Massachusetts even argued that Reddit-fueled trading could lead to "systemic risk" in the markets.

Now that the leveraged bets of Archegos have sent a handful of stocks crashing and caused reverberations throughout the markets, Reddit traders are questioning the way they were treated by regulators and the media compared with hedge funds.

A post that garnered over 14,000 upvotes in under five hours on Monday made the Redditors' case: "Can we just appreciate for a moment that a large multi family private office leveraged themselves to the t--s, defaulted on a margin call, and it causing a market wide sell off to the tune of tens of billions of dollars, and yet I'm the irresponsible retail idiot who's risky trading is dangerous."

Archegos Capital is run by Bill Hwang, a former investor at the famous fund Tiger Management. Archegos' inability to meet margin calls forced banks into block sales of $20 billion of stock held by the firm.

The sales created a sell-off in many big names, from Baidu to Discovery, on Friday.

Many Redditors and market commentators questioned why the banks would allow Archegos to leverage its bets to such an extent given Hwang's history: He pleaded guilty to wire fraud in 2012 after his firm, Tiger Asia, traded on nonpublic information, reaping $16 million of illicit profits in 2008 and 2009, Bloomberg reported.

Bloomberg's report said that Goldman Sachs had Hwang on its blacklist after he was charged, but "at some point in the past two-and-a-half years, the firm changed its mind about Hwang."

That change of heart may have allowed Hwang to leverage his bets on equities. While it's hard to say that the Archegos turmoil has created a systemic risk to the markets, it very well could moving forward.

"The Archegos drama involves a classic mix of massive leverage, concentrated positions, derivative overlays, forced deleveraging, and distressed sales," Mohamed El-Erian, the president of Queen's College and the chief economic advisor at Allianz, said in a LinkedIn post. "The pain has been felt so far only in a handful of stocks ... What happens next depends on remaining sales and related contagion channels."