Cryptocurrency advocates are welcoming the new wave of asset trading market participants to Twitter. These are traders from the hugely popular channel r / WallStreetBets on the Reddit platform, commonly known as WSB.
The latter made headlines around the world the day before after its members collectively began buying shares in GameStop GME, an American gaming accessories store and retailer. In March last year, the stock traded for just $ 2.63, while the stock is now trading at $ 347. In this regard, many cryptocurrency lovers wondered if the collective efforts of traders could do the same with Bitcoin and altcoins.
By tradition, let’s start with an explanation. GameStop is a Texas based company founded in 1984. She sells computer games and various accessories. Since in recent years gamers prefer to buy everything online, rather than on physical media, the position of the company has deteriorated significantly. To illustrate: On November 1, 2013, a GameStop GME share was asking for $ 55, and last summer it cost $ 4.
However, this is not all: in recent years, large funds from Wall Street have been openly shorting GameStop shares, that is, earning on their fall. At the same time, analysts from financial giants talked about the uselessness of the company – yet in 2021 hardly anyone will go to the store for a game disc – thereby provoking a further drop in shares.
The already mentioned members of the WallStreetBets channel did not like the situation. They massively undertook to buy up the shares of the GameStop company, which caused their rate to skyrocket to new highs. The rally also ended in losses for the Wall Street giants, which had to quit short.
Why GameStop stocks are going up
The main message in which many admire the WSB is the expectation of a similar leap in Bitcoin. For example, here is a tweet from a user under the pseudonym Croesus, in which he hinted at the likelihood of a repetition of a similar situation with cryptocurrencies.
Do you see this rage? Do you see this community directing their anger towards the system? What do you think will happen when they find out what Bitcoin really is? The bullish trend in 2021 could be bigger than any of us thinks.
That is, the user assumes that traders will do the same with the main cryptocurrency when they get acquainted with the principles of interaction with the blockchain in more detail. Allegedly, since the shares of a little-known company were able to take off, then the situation with Bitcoin will be even larger.
There is one problem here, though: WallStreetBets traders just aren’t that interested or enthusiastic about cryptocurrencies. Firstly, the channel moderators do not approve of any messages or comments with the words “Bitcoin”, “Ethereum”, “cryptocurrency” or other related terms. Any messages that violate the rules are immediately removed, that is, raising this topic among traders will not work, Decrypt reports.
Secondly, WallStreetBets representatives also oppose the promotion of stocks, which are easy to manipulate for quick profits. The channel’s moderators are hostile to any mention of the prospects for securities of companies whose market capitalization does not exceed the billion dollar threshold.
Still, the smaller the company’s capitalization, the easier it is to influence the value of its shares. And this option is not suitable for those who like buying assets.
The takeaway from the situation is obvious: while we are unlikely to see a sharp tenfold rise in Bitcoin, as happened with GameStop shares. However, one news of the successful confrontation between ordinary traders and Wall Street financiers is already a signal – the paradigm is changing. It is possible that well-known moneybags and funds no longer have such tremendous power over the markets, which means that power will eventually pass into the hands of ordinary traders.
However, in general, we believe that there is no point in such attempts to short-term growth in Bitcoin or other cryptocurrencies. The industry has moved to a long stage of recovery, which was confirmed the day before by the head of the largest exchange Binance, Changpeng Zhao. Accordingly, investors will observe the growth of various coins and without questionable manipulations. So in this case it is worth only to rejoice at the ability of ordinary people to influence the world, but for cryptocurrencies this option is clearly superfluous.