Memecoins
GameStop Memecoin Rises 24% Following Release of Citron Research, Outpacing DOGE and SHIB
- GameStop shares surged more than 640% following Keith Gill’s return to social media.
- The GameStop-inspired memecoin surged 23.81%, outperforming major memecoins such as Dogecoin and Shiba Inu.
GameStop (GME) shares have seen significant volatility, skyrocketing more than 640% following the return of retail investor Keith Gill, known as Roaring Kitty, to social media. This dramatic increase in the value of the shares contrasts sharply with the recent decline of 0.58%, bringing the stock to $29.84. This fluctuation coincides with Citron Research’s announcement that it has closed its short position in GameStop shares.
In a June 12 post, Citron Research explained its decision, citing the “irrationality” of the market and the “cultistic” behavior of GameStop shareholders. They stated,
Citron is no longer short $GME. It’s not because we believe a breakthrough to the company’s fundamentals will ever happen, but with $5 billion in the bank, they have enough ground to please their cult shareholders.
The unexpected surge of GME Memecoin
GameStop shares saw a notable jump of nearly 23% on Tuesday, helping to double its value over the past six months. The renewed interest in GameStop stock was significantly influenced by Keith Gill’s recent reappearance on YouTube, which marked his first live stream in three years.
The impact of his presence on the stock market continues to be substantial, reminiscent of the events of 2021 that initially brought the retailer into the spotlight of retail investors. This surge outpaced major memecoins like Dogecoin (DOGE) and Shiba Inu (SHIB), which rose 6% and 3.7%, respectively.
This phenomenon of social media-driven market movements has not been welcomed by everyone. In an interview with CNBC, former SEC Chairman Jay Clayton expressed concern, stating:
It bothers me on many levels. It is much closer to gambling than trading and certainly not investing.
In a recent announcement on the New York Stock Exchange, GameStop confirmed the sale of all 75 million shares offered to investors, successfully raising $2.137 billion. This follows the sale of 45 million shares last month, which netted the company $933.4 million. GameStop has raised more than $3 billion through stock sales over the past month, significantly boosting its market value.
The capital raised through these stock sales is expected to provide GameStop with substantial financial flexibility, potentially aiding its continued efforts to pivot its business model and invest in growth opportunities.
GameStop Memecoin Performance and Sentiment Analysis
Despite the price surge, Santiment data analysis shows that Dogecoin significantly overshadows GameStop memecoin in terms of social dominance. This disparity highlights the different influence and reach of different memecoins on the market.
Overall sentiment around the GameStop-inspired memecoin remains mixed. The Relative Strength Index (RSI) is above the neutral line, indicating strong bullish momentum. However, if memecoin breaks down below the $0.0157 support level, it could signal a downtrend.
The unexpected rally in GameStop shares, largely orchestrated by retail investors, had significant financial consequences for professional Wall Street firms that had bet against the retailer. This phenomenon, a short squeeze, forced these companies to cover their positions at substantial losses. The renewed interest in GameStop, led by influencers like Gill, continues to highlight the influence of retail investors in the stock market.