Home Editor's Pick E*Trade Weighs Removing Meme Stock Trader Roaring Kitty from Their Platform

E*Trade Weighs Removing Meme Stock Trader Roaring Kitty from Their Platform

by

TLDR

E*Trade is considering removing prominent meme stock trader Keith Gill, known as “Roaring Kitty,” from its platform over concerns of potential stock manipulation.
Gill recently posted screenshots on social media showing he holds a large position in GameStop (GME) stock and options, causing the stock price to surge.
E*Trade and its owner Morgan Stanley are concerned Gill could use his influence to pump GME for his own benefit, but are also worried about potential backlash from his followers if they remove him.
The Massachusetts Securities Division and the SEC are reportedly investigating Gill’s activities and GameStop call options trades around the time of his social media posts.
Gill’s return to social media after a three-year hiatus has significantly impacted GameStop’s stock price, with shares rising nearly 68% this year and over 60% since his return.

E*Trade, a popular online brokerage platform owned by Morgan Stanley, is considering removing prominent meme stock trader Keith Gill from its platform amidst concerns of potential stock manipulation.

Gill, known on social media as “Roaring Kitty” or “DeepFuckingValue,” has gained a significant following for his role in the 2021 GameStop short squeeze and his recent return to social media.

Gill purchased a large volume of GameStop (GME) options on ETrade shortly before breaking his three-year social media silence last month.

Some of these options expired within the week and likely resulted in a profit for Gill. Following his return to X and Reddit, GameStop’s stock price surged, raising concerns among ETrade and Morgan Stanley executives.

The firms are now debating whether Gill’s recent posts could be considered manipulation, as they worry he may use his influence to pump GME for his own benefit.

However, they are also concerned about the potential backlash from Gill’s followers if they decide to remove him from the platform, as it could lead to negative attention and account closures in solidarity with the trader.

On June 2, Gill posted a screenshot on Reddit showing he held $181.4 million worth of GME stock and call options, betting the stock would be at least $20 per share by June 21.

GME YOLO update – June 2 2024

This post caused GME to rally over 19% in Sunday night trading and close up 21% at $28 on Monday, June 3. The stock has gained nearly 68% this year and over 60% since Gill’s return to social media.

Regulators are also reportedly investigating Gill’s activities. The Massachusetts Securities Division is examining Gill’s actions, as he holds several securities-industry licenses and was previously a registered broker with Massachusetts Mutual Life Insurance.

The Securities and Exchange Commission (SEC) is also reportedly reviewing GameStop call options trades around the time of Gill’s X posts, discussing internally whether such trades could be considered manipulation.

As of now, no decision has been made regarding Gill’s status on the E*Trade platform, and the firms may ultimately choose to take no action.

Gill has not publicly commented on the matter, but he did post another screenshot on Reddit on June 3, showing an apparent $33.6 million gain on his GME shares and a $51.8 million gain on his options.

The post E*Trade Weighs Removing Meme Stock Trader Roaring Kitty from Their Platform appeared first on Blockonomi.

You may also like