Famed investor and meme stock celebrity Keith Gill, better known as Roaring Kitty, may be dropped from top retail stock trading platform ETrade, according to a Wall Street Journal report.
Citing “people familiar with the matter,” the WSJ said Monday that ETrade, owned by investment giant Morgan Stanley, is “growing concerned about potential stock manipulation around his recent purchases of GameStop (GME) stock.” The exclusive report comes as Gill’s long-dormant account on Reddit posted a screenshot late Sunday of an investment account holding over $200 million worth of GameStop shares and call options.
The return of Roaring Kitty to Twitter last month, and the DeepFuckingValue account on Reddit yesterday, has undoubtedly moved the market. After a Twitter post broke a two-week silence, the price of GME stock nearly doubled before the stock market opened the week. That price surge brought a big hit to GME short sellers, who stood to lose almost $1 billion betting against it.
BREAKING: RoaringKitty, aka DeepFuckingValue, has posted an update to his GameStop, $GME, position.
He has held all his shares and calls.
He is up 48% today, or $85 million dollars. pic.twitter.com/9ow0Nwtecq
— unusual_whales (@unusual_whales) June 3, 2024
Even the unofficial GME tribute meme coin on Solana saw its price skyrocket over 150%.
All of this echoes the meme stock mania that gripped both social media and traditional markets in 2021, where short-sellers of stocks like GME and AMC Entertainment (GME) were targeted by Roaring Kitty and other disillusioned investors, boosting their prices and causing significant losses for institutional fund managers.
That frenzy caused many investment platforms—including the popular Robinhood app—to frequently halt trading of the suddenly volatile stocks, to great uproar—and eventually hearings on Capitol Hill.
In fact, the WSJ reports, Morgan Stanley employees had been monitoring Gill’s ETrade account since Roaring Kitty resurfaced on Twitter in mid-May, after more than two years away.
The employees “saw he had purchased call options before the tweet,” and that “Gill’s trades likely generated profits thanks to the stock move his tweet generated,” the Journal reported.
With GME seeing a new flurry of activity, ETrade appears to be considering pulling the plug on Gill. Based on the Reddit posts, he stands to make a tidy sum if his latest bet—that GME stock will be worth more than $20 on June 21—turns out to be true. Those who follow his lead would gain as well.
Today alone, the Roaring Kitty account is up 48%, or about $85 million, according to investment tracker @unusual_whales on Twitter.
Parent company Morgan Stanley engaged its financial crimes unit and external counsel on the matter. But the company knows that taking action would mean “drawing the attention of his meme army.“
“Morgan Stanley employees have been concerned that closing Gill’s account could result in the firm losing ETrade clients,” the Wall Street Journal noted.