GameStop $GME Memecoin: 230% Surge as Keith Gill Post Shows $116M Million Bet

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The memecoin GameStop ($GME) surged over 230% during trading on Monday. The meteoric rise came after a Reddit post by influential stock trader Keith Gill, also known as “Roaring Kitty,” revealed a massive $116 million bet on the gaming retailer.

Gill’s post, which appeared on his Reddit account, marked his first appearance on the social media platform in three years. It harkened back to a time when his bullish GameStop trades captivated investors’ attention and sparked a frenzy around meme stocks.

Gill’s screenshot showed $20 call options for GameStop, set to expire on June 21. Notably, the stock had closed at $23 on the previous Friday, already experiencing a 33% increase.

Notably, he didn’t post on the infamous WallStreetBets chatroom, where he posted all of his trade updates at the height of the GameStop mania over three years ago. Instead, he posted on the Superstonk chatroom, which is ostensibly dedicated to all things GME.

The resurgence of Gill’s involvement fueled speculation about whether he would resume sharing his trades online after his three-year hiatus. This is specifically true, given the recent cryptic posts and memes shared by Gill on X.com.

Key Takeaways

  • Keith Gill triggered a massive rally in GameStop stock in January 2021 as a community of Reddit investors came together to squeeze short-selling hedge funds.
  • GME crypto token was created to commemorate the third anniversary of the GameStop short squeeze.
  • Oslo-based digital asset research firm K33 Research broke down three ways to trade memecoins in a report.
  • K33 Research added that a “crypto barbell strategy is perfectly rational.”

What is GameStop Crypto?

GME is the unofficial meme coin of New York-listed company GameStop. The cryptocurrency does not have any official connection with the company.

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According to the project’s official website, the GME memecoin was created to pay homage to the GameStop short squeeze saga that occurred in January 2021, when retail investors came together on a Reddit forum called “wallstreetbets” to squeeze short positions held by institutional investors and hedge funds.

The token came into existence in January 2024 on the Solana blockchain to mark the third anniversary of the historic GameStop short squeeze saga.

GME called itself a “parody of GameStop” and a “community coin on SOL.”

Price analysis of GME

After an eventful launch, the coin saw subdued market interest until mid-May 2024, when GME gained second wind after GameStop stock surged about 75% on May 13, 2024. In turn, the GME token ended the day over 1800% higher.

The comeback of finance influencer Keith Gill after a three-year hiatus sparked the surge in GameStop stock price and GME crypto price.

GME Tokenomics

Here are some important information that GME holders should know:

  • GME has a max supply of 6.885 billion, of which 100% is currently in circulation.
  • The token 50 GME holding addresses, including crypto exchanges like Gate.io and Bitget, held about 43% of total GME supply, as of May 23, 2024.
  • Total GME holding addresses stood at 43,226, at the time of writing. For context, popular and older Solana-based memecoins dogwifhat and Bonk had 142,700 and 730,682 holders, respectively.
  • GME was the 744th largest crypto in the world with a market cap of $32.8 million, as of May 23, 2024.

Are the Price Performances of GameStop Stock and GME Crypto Correlated?

Let’s compare the price performance of GameStop stock and GME crypto during the May 2024 rally:

Date GameStop stock GME crypto
May 10, 2024 (Friday) -3% -9%
May 13, 2024 (Monday) +74% +1860%
May 14, 2024 (Tuesday) +60% +48%
May 15, 2024 (Wednesday) -18% -27%
May 16, 2024 (Thursday) -30% -32%
May 17, 2024 (Friday) -19% -10%

As you can see GameStop stock and GME crypto have shown a tendency to trade in the same direction, however GME crypto does not track GameStop stock’s performance perfectly.

Keith Gill and GameStop: Why is Roaring Kitty Important to GME Holders?

Keith Gill will continue to be a key social figure to monitor for GME holders due to his influence over the market. Gill’s comeback tweets in May 2024 pumped GME token price by 1860% on May 13, 2024 without even mentioning “GameStop.”

Gill’s reluctance to directly mention “GameStop” from his tweets is understandable, as Gill was hit with a class action lawsuit in February 2021 for allegedly hiding his financial background while sharing his GameStop positions on Reddit’s Wallstreetbets forum in September 2019.

At the time, Gill had disclosed his position of over $53,000 in Gamestop common stock and long options on Wallstreetbets. He continued to provide updates on his GameStop holding and analysis on GameStop stock, where he often cited the high short interest in the stock.

As more users caught wind of the tip, investing in GameStop became a community movement with the aim of humbling short-selling professional investors. In January 2021, GameStop stock rose by 1625%.

Gill’s Reddit profile fell silent after posting his “final update” on his GameStop holdings on April 16, 2021. Meanwhile, he continued to post on X until mid-June 2021.

Gill’s recent comeback on X has got GameStop investors excited again. Within a few days of his return, Gill’s follower count has surged to over 1.2 million.

Analyst View: How to Trade Memecoins?

Oslo-based digital asset research firm K33 Research broke down three ways to trade memecoins in a report. They were:

  • Short-term compounding low caps – K33 Research advised readers to “get in and out quickly” as most memecoins fade away. Investors can use on-chain charting tool such as dexscreener to sort new memecoins and to find new tokens “with bullish structure that are pulling back,” said K33 Research.
  • “Spot as a call option” low caps – If traders are looking for 100x upside on a small allocation, K33 Research said traders should speculate on tokens that have the potential to make a big run. K33 Research said “buy it, set a price alert, and forget it.”
  • Jumping on board mid-caps for escape velocity – “ Before a memecoin goes to $1b market cap, it has to first break into the $100m market cap territory. As a general rule, if the meme insists on consolidating around this level, it is proving their staying power and you have a good candidate for something that can run for $1b+,” said K33 Research.

K33 Research added:

“If we view crypto as a primarily momentum-driven asset class with very few projects possessing true fundamentals to justify valuations, a “crypto barbell strategy” is perfectly rational. This is where one holds only “low-risk” crypto (BTC, ETH) and high-risk crypto (memecoins) while ignoring everything else (crypto tech).”

The Bottom Line

GME is the latest meme coin to spark the interest of crypto investors.

What makes it different is its connection with the historic GameStop short squeeze saga of January 2021 and the sense of community evoked by a “David vs Goliath” battle between individual traders and institutional hedge funds.

How long will GME meme coin stay relevant though? We will see.

A reminder that meme coins are highly volatile and risky cryptocurrencies. Most meme coin projects enjoy a short period of fame and may become irrelevant after the market loses interest in them.

Always do your own research before investing, and note that past performance is no guarantee of future results. This article should not be considered investment advice and is for information purposes only.

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Mensholong Lepcha
Crypto & Blockchain Writer
Mensholong Lepcha
Crypto & Blockchain Writer

Mensholong is an experienced crypto and blockchain journalist, now a full-time writer at Techopedia. He has previously contributed news coverage and in-depth market analysis to Capital.com, StockTwits, XBO, and other publications. He started his writing career at Reuters in 2017, covering global equity markets. In his free time, Mensholong loves watching football, finding new music, and buying BTC and ETH for his crypto portfolio.