It didn’t take much to re-light the fire under so-called meme-stock $GME; just a single post from trader Keith Gill, who goes by the name Roaring Kitty. The image accompanying the post on X, of a gamer leaning in towards his screen, set the market soaring in a giddy flashback of the meme-stock surge of three years ago.
— Roaring Kitty (@TheRoaringKitty) May 13, 2024
The post has been viewed more than 24 million times, and GameStop shares, which were already starting to climb in early May, shot up as much as 119 percent in early trading on Monday, ending the session up 74 percent.
In 2021, Gill, aka DeepFuckingValue on Reddit, gained notoriety by highlighting substantial bets against GameStop, suggesting that a surge in price would force short sellers to purchase stock to offset their positions. Surprising even for Gill, a huge David versus Goliath movement soon formed, fuelled by Reddit Forum WallStreetBets with casual traders taking on a system they had traditionally felt was hugely stacked against them. One casualty, Melvin Capital, a New York hedge fund, saw a 53% decline in the value of its fund in January 2021 and was eventually forced to close up shop.
The story was compelling, spilling into main headlines as traders held firm. Hollywood even climbed aboard, making a film called Dumb Money, which premiered late last year. The film depicts Gill as an everyday guy from Massachusetts in what critics called a "crowd-pleasing underdog story" and stars Pete Davidson and Paul Dano.
Back then, a temporary and mandated halt in trading was triggered to let investors cool off for a bit, and on Monday, another circuit breaker was tripped. Trading platform Robinhood, the preferred platform for traders during the last run, had to issue a denial late Monday that it had halted $GME purchases once again. “This is incorrect. Robinhood has not shut down the purchase of Gamestop shares,” Robinhood spokesperson Anupriya Ghate said in a statement to CNN.
By the end of trading on Monday, short sellers had lost more than $1 billion betting against GameStop, according to data company S3 Partners. And Roaring Kitty is showing no signs of limiting the pressure, posting several cryptic messages by the end of Monday and firing up many X users hoping for a repeat of 2021. Even Andrew Tate, while awaiting trial for sex trafficking, is in on the game, claiming to have bought 1 million in stock.
WallStreetBets was buzzing with excitement yesterday. One user posted that he had stuck his life savings into the stock, claiming he was putting “Every penny I have (except $6 for food tomorrow) into this play."
Experts, however, are skeptical. Josh Gilbert, eToro's market analyst, told Cointelegraph that it probably won’t be that easy this time around. "I think it will certainly ignite some short-term moves." But, he added, "I think we’re in a completely different position from where we were in 2021, which makes me think a similar rally would be unlikely."
Shares of GameStop were up around 40% in premarket trading this morning. In 2021, some suggested the surge in $GME triggered a meme-coin run - will we see the same this time? By the time of writing, GameStop was still on the rise and showing no signs of slowing.
Members Discussion