Buy and short Gamestop stocks with Bitcoin? This is now possible – thanks to FTX

This David versus Goliath story is currently turning Wall Street upside down: An army of Reddit users has been causing a price explosion for the ailing company Gamestop for days. It bankrupts large hedge funds; it makes individuals very rich.

If you still want to get in, you can now do so via Bitcoin thanks to FTX – and also against the GME rate

Last spring, Gamestop (GME) stock wasn’t even worth $ 3. The gaming company behind it has been stumbling for years, missed the connection to online business and invested money incorrectly. On January 4th, a good three weeks ago, the share was worth just under 18 US dollars and had gained around 500 percent in ten months. Very few could have guessed that this was just the beginning. However, a group of users of the anonymous social network Reddit tried everything to ensure that the price of the ailing company continues to rise. In the meantime it stood at 482.85 US dollars (high January 28), so it has gained over 15,000 percent. In less than a year. But how did that happen?

In any case, the price explosion is not due to good news from the company, for one year one bad news has followed the next, first hundreds of branches are closed here, then millions in losses are announced there. The online magazine Slate established the latest bull markettherefore not with the “greatest comeback story in the history of the free market economy”. Rather, the development is „symptomatic of financial life in 2021“. The development of the Gamestop share is representative of the “democratization of financial trading” and the “power of the gigantic online communities”. What the latter are capable of was only seen a few weeks ago in the storming of the Capitol in Washington DC, when Trump supporters and conspiracy mythics stormed the barricades waving QAnon and Pepe-the-Frog flags.

Gamestop: Reddit vs. Wall Street

Now, a particularly popular branch of the large online community Reddit has taken on Wall Street’s hedge funds. In particular, users of the 4.3 million strong subreddit r / wallstreetbets agreed to beat institutional investors at their own gun (and make a fortune on the side). The Reddit user u / Player896 had the idea last September. In r / wallstreetbets he published his seven-part plan: “Driving institutional investors to ruin for dummies – using Gamestop”. He had found that the Gamestop stock had enormous short positions on the part of institutional investors. If he and his Reddit network managed to get the stock up a little now, the hedge funds would be forced to abandon their short positions and buy back their shares – thereby increasing the price.

The highlight: The plan works. And: Even with the above-mentioned price increases, Reddit users are still convinced that there is still a lot of room for improvement at Gamestop – there is talk of up to 5,000 US dollars per share. u / DeppFuckingValue is probably the best-known r / wallstreetbets user and is treated like royalty in the subreddit. He got in at just under $ 15,000 at a rate of around $ 3.50, and his shares are now worth almost $ 48 million – and he still holds . And while some shareholders got very rich in a very short space of time, it also had the desired effect of driving institutional investors with large short positions into bankruptcy.

Melvin Capital, for example, has already cost around 30 percent of its capital at the current price rally . Even a rescue package amounting to 2.75 billion US dollars, which the hedge funds Citadel and Point72 has made available to Melvin Capital so far, could not save the institutional investor from bankruptcy. On January 22nd alone, Gamestop Shorter lost $ 1.6 billion in capital. And how does it continue? According to some analysts, the bull market cannot last and is predestined for a hard crash. That calls again for shorters who smell the quick money. And this time the crypto space is also part of the party.