Arab Press

بالشعب و للشعب
Friday, Aug 22, 2025

GameStop surges again as Reddit crashes temporarily

GameStop surges again as Reddit crashes temporarily

Shares in GameStop surged on Wednesday in what could mark a return to frenzied trading that rocked markets last month.

Trading in the US games firm was halted twice after shares more than doubled suddenly on Wednesday afternoon.

GameStop stock climbed by 104% until trading was halted for a second time - moments before markets closed.

The rapid rise came as Reddit, the online home of activist investors that led the GameStop movement in January, went down temporarily.

The stock gained nearly 90% in after-hours trading.

It came one day after the firm announced its chief financial officer Jim Bell would resign next month to help "accelerate GameStop's transformation".

Some investors have talked publicly and posted on social media site Reddit about not selling their shares in GameStop during last month's volatile trading because of what they see as its long-term potential.

On Wednesday, Reddit was down for many users. The company did not say what caused the outage but said it had identified the issue, fixed it and that "systems are beginning to recover."


It is the latest twist in a battle that has pitted amateur investors against Wall Street giants.

Major hedge funds had bet billions of dollars that GameStop's shares would fall.

But they have faced major losses after amateurs, swapping tips on social media sites like Reddit, drove up the share price by more than 700% in one week.

The retail trading frenzy drew concern from regulators and has even led to a Congressional hearing in the US.

Keith Gill, who became a key player in the trading and is known as 'Roaring Kitty' on YouTube, has also been hit with a class action lawsuit. He allegedly duped retail investors into buying inflated stocks while hiding his sophisticated financial background.

Mr Gill has downplayed his impact and rebutted claims he violated any laws.

"The idea that I used social media to promote GameStop stock to unwitting investors is preposterous," Mr Gill said in the prepared testimony.

"I was abundantly clear that my channel was for educational purposes only, and that my aggressive style of investing was unlikely to be suitable for most folks checking out the channel."

The GameStop saga was hailed as a victory of the little guys against big Wall Street hedge funds that were betting against video games retailer GameStop and other struggling businesses.

But it is unclear what role hedge funds had in the rally, as some are reported to have made millions from the GameStop share rally that was inspired by Reddit users.


GameStop: A story that isn't going away

The key part of the theory of why GameStop shares went up so high in January was a 'short squeeze'.

This is when hedge funds, who'd bet GameStop shares would fall, tried to buy them back when the share price began to rise.

That in turn pushed the price even higher. Some hedge funds lost hundreds of millions of pounds.

The prevailing view was that hedge funds wouldn't put themselves into that position again. That they would be all over Reddit and more careful about 'shorting'. Therefore, you wouldn't see a giant spike in the share price again.

But evidently, that view was wrong. That the share price, in just a few hours, could explode again tests some of the assumptions about what happened last month.

It's often very difficult to understand exactly what drives a share price, and who is driving it.

But it does once again appear that the hype on WallStreetBets, the influential subreddit, was part of the rise.

Reddit even went down at one point, though it's not clear yet whether that was because of an increase in activity on the site.

Policy makers will be looking on closely. At a hearing last week in Washington, many politicians were concerned that 'meme stocks' could spike again.

That can be beneficial to some investors when the stock is rising. But on the way down amateur investors can get burnt too.

If these kinds of spikes become more common, expect more pressure on legislators to step in.


WATCH: What's been going on at GameStop?


Newsletter

Related Articles

Arab Press
0:00
0:00
Close
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Trump Backs Putin’s Land-for-Peace Proposal Amid Kyiv’s Rejection
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
Iranian Protection Offers Chinese Vehicle Shipments a Cost Advantage over Japanese and Korean Makers
United States Sells Luxury Yacht Amadea, Valued at Approximately $325 Million, in First Sale of a Seized Russian Yacht Since the Invasion of Ukraine
Saudi Arabia accelerates renewables to curb domestic oil use
Cristiano Ronaldo and Georgina Rodríguez announce engagement
Asia-Pacific dominates world’s busiest flight routes, with South Korea’s Jeju–Seoul corridor leading global rankings
Private Welsh island with 19th-century fort listed for sale at over £3 million
Sam Altman challenges Elon Musk with plans for Neuralink rival
Australia to Recognize the State of Palestine at UN Assembly
The Collapse of the Programmer Dream: AI Experts Now the Real High-Earners
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
JPMorgan and Coinbase Unveil Partnership to Let Chase Cardholders Buy Crypto Directly
British Tourist Dies Following Hair Transplant in Turkey, Police Investigate
WhatsApp Users Targeted in New Scam Involving Account Takeovers
Trump Deploys Nuclear Submarines After Threats from Former Russian President Medvedev
Germany’s Economic Breakdown and the Return of Militarization: From Industrial Collapse to a New Offensive Strategy
Germany Enters Fiscal Crisis as Cabinet Approves €174 Billion in New Debt
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
President Trump Diagnosed with Chronic Venous Insufficiency After Leg Swelling
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
Iranian President Reportedly Injured During Israeli Strike on Secret Facility
Kurdistan Workers Party Takes Symbolic Step Towards Peace in Northern Iraq
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
AI Raises Alarms Over Long-Term Job Security
Russia Formally Recognizes Taliban Government in Afghanistan
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Mediators Edge Closer to Israel-Hamas Ceasefire Agreement
Germany Seeks Taliban Deal to Deport Afghan Migrants
Emirates Airline Expands Market Share with New $20 Million Campaign
Robots Compete in Football Tournament in China Amid Injuries
×