In 2021, private investors drove up GameStop’s stock price significantly, aiming to frustrate institutional hedge funds. Now, the stock has once again surged in value, with one of the key figures behind the initial rally making a comeback.
Is the GameStop stock frenzy returning? Shares of the American video game retailer skyrocketed by 40% in pre-market trading in the US. This surge appears to be fueled by speculation about the return of a pivotal player in the 2021 stock rally—Keith Gill, a social media personality.
Gill is known on YouTube as “Roaring Kitty” and on Reddit as “DeepF***ingValue.” On Sunday, Gill posted on the social media platform X, sharing an image of a man leaning forward in a chair—a popular meme among gamers signaling that things are about to get serious. This marks his first post on X since mid-2021, after a lengthy absence from social media.
GameStop’s shares are categorized as “meme stocks,” a term that also includes stocks like those of the movie theater chain AMC. The GameStop frenzy in 2021 was driven by private speculators who coordinated online to bet against hedge funds that had shorted the stock. By driving GameStop’s stock price to unprecedented heights, these individual investors managed to inflict substantial losses on institutional hedge funds.
The strategy of these private investors was largely organized on the Reddit discussion group r/wallstreetbets. There, Gill shared updates on the profits he was making from his investments, sparking a wave of interest in GameStop. During the last week of January 2021, GameStop’s stock soared by 400% before falling back to its previous levels shortly afterward.
The volatility generated headlines far beyond the financial world, particularly because the hedge funds affected by the surge suffered significant losses. Despite the hype, GameStop later faced economic challenges, leading to the closure of numerous stores.
