It was roughly one year ago that Redditors of r/WallStreetBets seized upon GameStop (NYSE: GME) shares in what they and many called a rebuke of Wall Street hedge funds. The event launched the meme asset phenomenon, launching other stocks into memehood and boosting meme crypto-assets such as Doge.
"We like the stock!" - A Tale of Reddit, Memes, and the Power of Social Media
The story is undoubtedly thrilling, especially in how the recently released "GameStop: Rise of the Players" frames it. A rag-tag group of everyday people from across the United States that had never met before launching a nationwide financial movement.
The event was framed as a rebuke of Wall Street, of fat cat hedge funds, and the practice of shorting companies.
Redditors on r/WallStreetBets who picked up the battle flag carried it across the internet, pushing GameStop to meme status while simultaneously causing a record-breaking bull run on the stock.
From a technical perspective, what Redditors and others achieved was as remarkable as it was perplexing: a blatantly artificial boosting of a stock's price, ostensibly to say "screw you" to the financial sector.
It wasn't long before other companies found themselves traded as memes, such as AMC (NYSE: AMC), who received a considerable boost from r/WallStreetBets.
In time, the rush spread to crypto assets as well. Many working with newfound knowledge of stocks looked into crypto assets and spread the movement to the blockchain, running up the prices of meme assets such as Doge. In the case of crypto, though, it was figures like Elon Musk directing this separate but-aligning charge.
Rise of the Players wraps up with a heartwarming ending, with the rag-tag group riding off into the sunset, having taken on Wall Street and made a killing doing it. Many other retail traders had benefitted at least somewhat, and the point had been made that everyday America was done with the antics of hedge funds.
...right?
"The House Always Wins" - The GameStop Rush in The Cold Light of Day
The story of a plucky group of everyday retail traders taking on Wall Street makes for a great story, but to say that the group of traders accomplished anything other than amassing millions is a bit of a stretch. What about Wall Street is any different than it was before the rush?
Investors were frustrated, of course, and lost a great deal of money fighting retail traders. GameStop as a company found itself able to push into the next generation, buoyed by the investments of everyday Americans who wanted to fight Wall Street with its own weapons.
But as things stand, the same funds sit atop the hierarchy, pulling the same moves as they always have. The only visible change affected by meme traders may kneecap future attempts to repeat the GameStop rush.
While influential, the feat of what essentially amounted to crowdsourced market manipulation caught unwanted attention from the U.S. Securities Exchange Commission (SEC). In October 2021, the SEC discussed that it had been weighing regulations to reign in the meme trading phenomenon.
The companies buoyed by the rush aren't doing much better. GameStop's shares are inflated in price but continue to decrease from their record highs, and with a lack of a clear plan on becoming competitive in the modern gaming market, they don't appear to have much reason to stop decreasing in value. Other firms vary, with some like AMC similarly encountering ongoing trouble and others returning to business as usual.
The statement of frustration towards Wall Street was definitely made, but aside from that and the millions that key players made, the war ended after a single battle. The sentiment of frustration is far from gone, though, and with the ongoing advance of technology in the finance sector, it's only a matter of time until another group finds a way to stick it to Wall Street.