Discord has banned r/WallStreetBets, the subreddit that drove GameStop’s stocks to record-breaking heights in recent days, from its website for violating its policy against hate speech. The decision sparked an outcry on social media, which caused Discord to quickly reevaluate its relationship with the subreddit.
GameStock’s stock has skyrocketed from $20 at the beginning of the year to a peak of more than $450 on Thursday morning after day traders from r/WallStreetBets began buying up the company’s stock. The event is unprecedented in the history of the stock market, as it marks the first time that a large group of small investors has collectively worked together to bet against large hedge funds. It is also extremely controversial and has divided internet spectators into two camps: those who support the day traders for taking on Wall Street investors and those condemning them for causing the investors to lose billions.
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On Wednesday, Discord announced that it banned r/WallStreetBets’ server, but not for financial fraud related to GameStop. Rather, the company said that the sever was banned because its users continued to post “hateful and discriminatory content after repeated warnings.” But the ban sparked a backlash against Discord on social media, with several people, including Elon Musk, accusing the company of siding with the hedge funds. Discord reversed its decision the next day, and is now working with members of r/WallStreetBets to moderate a new version of the server.
“WallStreetBets members have set up a new server and we are working with them,” a Discord spokesperson said in a statement to The Verge. “We will welcome the group back so long as they improve their moderation practices and follow our Community Guidelines. We have reached out to the moderators to provide them with support and advice, like we do for many of our large communities.”
The new r/WallStreetBets Discord sever has more than 300,000 members and continues to grow rapidly. The Verge reported that the old server was known for its vulgar language and racist comments, but noted that Discord’s decision to help moderate it has yielded positive results, as the amount of profanity and racial slurs have noticeably decreased since the temporary ban.
GameStop’s stock has fallen from its peak, and the situation continues to rapidly evolve. Day traders from r/WallStreetBets have begun to target other struggling companies who were being shorted by hedge funds, such as Nokia and AMC, the latter of which saw its stocks dramatically surge on Wednesday and then fell on Thursday.
Several prominent figures have weighed in on the event, including the White House, which said it was monitoring the situation. Rep. Alexandria Ocasio-Cortez of New York and Rep. Elizabeth Warren of Massachusetts have taken the side of the day traders and accused Wall Street hedge funds of treating the U.S. economy like a casino. Musk, who helped draw attention to the rally by tweeting about it, has also sided with Reddit day traders, as he accused Discord of “going corpo” after it banned the r/WallStreetBets server.
Meanwhile, prominent Wall Street investors such as Big Short investor Michael Burry have criticized the day traders for causing “unnatural, insane, and dangerous” changes in the stock market.
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Source: The Verge