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Lionel Laurent

GameStop's ‘French Revolution’ Is a Crypto-Farce

Pseudo-populist Redditors show Bitcoiners a thing or two about taunting regulators.

Taking on Wall Street.

Taking on Wall Street.

Photographer: Omar Marques/SOPA Images/LightRocket via Getty Images

The GameStop Corp. short squeeze has been tipped as finance’s “French Revolution” — a middle finger to the establishment by a hive mind of Redditors able to channel cash into the stock market at such pace and scale that expert hedge funds have had to be thrown lifelines. That bored day-traders could teach the pros a thing or two is reminiscent of other tales of the wisdom of the crowds — Garry Kasparov’s four-month chess match against the internet in 1999 comes to mind. It’s also rightly attracting regulatory scrutiny.

The worry is that, rather than a glorious decentralization of finance, what seems to be unfolding here is a crypto-esque farce combining volatile trading and chatroom-driven tips reminiscent of cryptocurrencies like Bitcoin and penny stocks all in a market juiced by pandemic stimulus. The U.S. Securities & Exchange Commission says it’s “actively monitoring” options and equities markets after a surreal few days that saw GameStop’s once-unloved retail chain skyrocket in value, forcing funds to unwind short positions at a loss.