Previously, the author of “The Big Short” owned about 5% of GameStop’s shares but before the stock achieved all-time highs of $400, Michael Burry sold his stake in the company. He asked the Securities and Exchange Commission (SEC) to investigate the “abnormal” trading.
Michael Burry, the CEO of Scion Asset Management, has been served with a subpoena by the Securities and Exchange Commission. The letter was sent on September 21 and is addressed to GameStop Corp., according to a scanned copy of the letter. The Securities and Exchange Commission in the United States is looking into a key figure in the GameStop story.
In January, GameStop stock was trading for about $400 per share on the New York Stock Exchange; it is now trading for roughly $185 per share. An army of naïve day traders and a few anonymous Wall Street veterans who utilized online forums like WallStreetBets to coordinate stock picks assisted GME’s rise. The first meme stock, GME, was a non-fungible asset whose value was decided by its cultural cachet rather than its actual value. AMC Theaters and BlackBerry, two dying enterprises, have found new life as meme stocks this year. GME’s stock price was boosted by an army of inexperienced day traders and a few anonymous Wall Street vets.
Meme stocks are comparable to meme tokens and coins, which are limited-use digital assets that can be traded for half-ironic LOLs. Dogecoin is the most widely used meme currency, having originated as a joke over a decade ago. SHIB (Shiba Inu), a new cryptocurrency based on DOGE’s dog-themed symbolism, was just launched on Coinbase. Users were outraged by Robinhood’s part in GameStop’s growth, and politicians demanded a hearing to determine whether the program was picking winners and losers. During a moment when the price of GME was skyrocketing, Robinhood made it impossible for users to buy more GME.
Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), has been keeping a close eye on things. It also wants to hear what Michael Burry saw, as well as the opinions of individuals not cited by Burry. “This is abnormal, insane, and lethal,” warns @SEC Enforcement. “If I put $GME on your radar, and you did well, I’m genuinely glad for you,” President Donald Trump wrote to GameStop in January. “What is currently taking place should have legal and regulatory ramifications,” writes SEC Enforcement.
Cryptocurrency expert Michael Burry was featured in the book “The Big Short”. He believes that in June, when crypto markets are most susceptible, the “mother of all crashes” would occur. The hedge fund manager, Burry has taken a position against BTC (Bitcoin), or more specifically, a Bitcoin-friendly company. Last month, he bought about 235,000 shares of Cathie Woods’ ARK Invest Disruption Innovation exchange-traded fund for $31 million. Scion reaps the benefits if the ARKK fund drops far enough. Burry’s hedge firm, which controls a $2 billion portfolio, has made money by hedging. He appears to have moved on from his call for the US Securities and Exchange Commission (SEC) to set up a special committee to oversee the Bitcoin industry. “With all that’s going on in the globe, why would I need to worry about the SEC?” he tweeted earlier this month.