During the pandemic, the market crashed and social media users naturally found an investment/finance community online as the world went into lockdown.
One of these communities can be found on Reddit. These Redditors began to notice that big time investors were shorting GameStop stock, meaning they were selling shares they didn’t own and waiting for the stock price to drop so that they could then buy back the shares at a lower price and gain a profit before giving shares back to their rightful owner. A little shady, sure, but not illegal, nor uncommon.
However, the Redditors wanted to teach bigger investors that shorting wasn’t going to be tolerated, so they bought up all the GameStop shares and beat the “big boys” at their game. GameStop shares shot through the roof at a 1,250% increase in just a few week’s time. Naturally, the bigger investors were furious and demanded that the responsible parties be held accountable, but the Redditors hadn’t done anything illegal either.
The subreddit, which originally started as a small group trying to make a profit, turned into a movement trying to “stick it to the man”...and succeeding.
All of this begs the question; do we need market regulations reform?
Infographic by: expensivity
