One of Reddit’s most active communities is no longer public.
For the past week, Reddit’s WallStreetBets community has been the center of an epic war between large Wall Street investors and small-scale social media betters. Now it’s reeling from its subreddit having been locked and hidden, only to be made public again about an hour later. Meanwhile, chat app Discord has banned WallStreetBets outright. All that seems to have spooked investors, some of whom dumped shares, and others who bought in, sending AMC and GameStop stock swinging wildly.
GameStop and AMC stock dropped dramatically in after-hours trading shortly after all the drama unfolded. They’ve since recovered somewhat, and the group has attempted to establish a new community on Discord.
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If all this is confusing, don’t feel bad. These fast and dramatic moves are happening amid one of the most dramatic weeks on Wall Street in years. At stake are millions of dollars that small-time investors working together on social media have made while taking on Wall Street investors who bet GameStop and AMC stock would plummet. Instead, as the two company’s stocks have soared, the Wall Street investors have reportedly hemorrhaged billions of dollars.
What does GameStop’s skyrocketing stock have to do with…
As the drama unfolded from the Discord ban and the Reddit community going on lockdown, GameStop shares fell 32% in after-hours trading late Wednesday, to $218.32 per share, down from $347.51 at their close. During the day, they’d more than doubled. AMC shares also fell, dropping more than 40%, to $11.90 per share, after closing at $19.90. That stock had risen more than 301% during the day.
Both stocks have recovered somewhat, and the r/WallStreetBets community is back. If you’d taken an hour and a half to watch Pixar’s new movie, Soul, you’d have missed it.
Though GameStop shares have been jumping in recent days, analysts and experts say they’re doing so because of quirks in the market and not because of actual increased value for the struggling video game retailer. The same is true for the movie theater chain AMC, which had warned it was near bankruptcy late last year.
All this wasn’t the only bad news for the WallStreetBets community. Its worst community members, who repeatedly broke Discord’s rules, caused the group to be banned from the platform, the chat app company said in a statement. “Today, we decided to remove the server and its owner from Discord for continuing to allow hateful and discriminatory content after repeated warnings,” Discord said. It added that the ban had nothing to do with any talk of finances or stock that happened among WallStreetBets users.