Then came war. On Tuesday, Citron Research founder Andrew Left, an activist investor and short seller, tweeted that he’d share five reasons why GameStop’s stock would plummet to $20 fast in an upcoming livestream. (The stock had by then climbed to $41.) “We understand short interest better than you and will explain,” he wrote. In a YouTube video, Left argued that GameStop is “a failing, mall-based retailer,” and that its value is “not based on any fundamentals, [which] just shows the natural state of the market right now.”
On Friday, Left set up a second Citron Research Twitter handle, claiming that several people had attempted to hack the main account, potentially in an attempt to disrupt his livestream. In a note tweeted from that backup account, Left wrote that “an angry mob who owns this stock has spent the last 48 hours committing multiple crimes,” alleging that the same group harassed “minor children” as well. He says in his YouTube video that someone ordered pizzas to his house and signed him up for Tinder.
WallStreetBets moderator Bawse1 says that he doesn’t know if those things happened, “and if they did, it’s not something we condone or promoted.” At least two posts on the subreddit refer to an alleged doxxing. WIRED has not confirmed whether doxxing happened, or if it was through WallStreetBets channels. Left did not respond to WIRED’s request for comment. Twitter told WIRED it locked his account as a precaution.
Tensions between retail investors like WallStreetBets and a traditional short seller like Citron Research have threatened to boil over for some time, in part because of a core philosophical difference. “The traditional Wall Street view is that markets are driven by some tie to fundamental value,” said Hoffstein. “What we’re seeing is an influx of speculative retail traders who don’t have any philosophy about valuation.” He quotes a phrase from Bloomberg’s Tracy Alloway: “Flows before pros.” The market will be driven by a flow of capital rather than fundamentals—not a novel quandary considering 1999’s dotcom bubble. (Then, too, day traders would often pile into a stock on the rise, assuming it would always go up.)
“I think the subreddit brings a new factor into stocks that wasn’t as prevalent as before,” says Bawse1. “It’s called hype.”
Meanwhile, calls of “BUY” alongside emoji rocket ships flooded the WallStreetBets Discord Friday, where over 25,000 onlookers watched chat fill with diamonds, rocket emojis, and obscenities. GameStop’s stock had just hit $60, a great leap from the $20 it was worth just last week. On Friday, 194 million shares were traded, over 12 times its average trading volume. In the Discord’s voice channel, where hundreds participated in the “gme-rocket,” yelling, humming, and intermittent announcements coalesced into something like a Gregorian chant. The stock continued to rise. It peaked at $73.09 midday today before quickly falling to about $58. Discord members urged each other to “HOLD.” Bawse1 says that this is the first time in years on WallStreetBets that “everybody was making money.”
WallStreetBets treats stock trading like a video game, says Jaime Rogozinski, who founded the subreddit but has not been affiliated with it since last year. Buttons. Graphs. Risk and reward. Hell, a Discord. According to Bawse1, a lot of the trading takes place on the Robinhood app, which advertises, “Level up with options trading … Choose your own venture.” Now that the barrier to trading options is lower than ever, having leverage in the stock market can be as easy as having a couple hundred thousand buddies and an app.