Robinhood app downloads surged nearly fivefold to 2.1 million last week, despite its GameStop trading restrictions

• Nearly five times as many Americans downloaded the Robinhood app last week compared to the week before.
• It was downloaded 2.1 million times in the US on the Google Play Store and Apple's App Store, per Senor Tower data.
• The app has been bombarded with one-star reviews for restricting trades of GameStop stock.

The Robinhood app was downloaded more than any other US trading app last week, despite a public outcry against its decision to restrict transactions involving some heavily shorted stocks such as GameStop, according to market researchers.

The app was downloaded 2.1 million times in the US on the Google Play Store and Apple's App Store in the week to January 31, according to data from Sensor Tower. This marks a 394% jump from the previous week for the San Francisco-based online broker.

This data could help ease Robinhood investor concerns that trading curbs imposed last week would cost the app users, ahead of a planned initial public offering later this year.

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Day traders banded together on Reddit and other social media sites to bump up the prices of several stocks, most notably video-games retailer GameStop but also AMC, BlackBerry, and Nokia, after noticing that Wall Street hedge funds were betting against them.

GameStop stock has gained massively in recent weeks - from below $5 late last year to a peak of more than $450 a share on Thursday. As a result, some of Wall Street's prominent hedge funds were forced to close their bearish bets against the company, with hefty losses.

Robinhood responded to the stocks frenzy by restricting purchases in highly volatile stocks on Thursday, causing GameStop to drop.

The online brokerage has come under fire for its decision, with Democratic Rep. Alexandria Ocasio-Cortez, Republican Sen. Ted Cruz, and Tesla CEO Elon Musk criticizing the move for disadvantaging individual investors. The app was also bombarded with negative reviews on the Google Play store.

But Robinhood CEO Vlad Tenev has argued the curbs were needed to safeguard its platform, given the collateral it needs to post to backstop many of the trades. Robinhood emailed members Monday, telling them: "We didn't want to stop people from buying stocks and we certainly weren't trying to help hedge funds."

The platform "experienced record growth during some of the most challenging days operationally this past week as Robinhood continued to lead the industry in app downloads last week by a wide margin," analysts at JPM Securities wrote in a note on Monday, citing data from SimilarWeb.

Robinhood declined to comment.

Competing brokerage firms are also benefiting from the retail trading boom. Social Finance's app saw the biggest week-over-week growth in percentage terms, at 900%, followed by Fidelity with 751%, Sensor Tower said.

A survey from Mizuho Securities did show that some unhappy Robinhood traders were leaving the app for platforms such as Cash, Stash, and Fidelity.

"We believe this could drive some level of account movement, but the faster that firms like Robinhood get back to normal operations, the less attrition we would expect," analysts at JPM wrote.

Politicians are currently scheduling meetings and potential investigations into the GameStop saga. Tenev is reportedly expected to testify at a House Financial Services Committee (FSC) hearing on February 18.