The s0-called GameStonks saga had some help from automated bots hyping up “meme” stocks on Facebook, Instagram, Twitter, and YouTube, according to an analysis by the cybersecurity firm PiiQ Media reviewed by Reuters.
Users on the Reddit forum r/WallStreetBets teamed up last month to trigger a massive short squeeze of GameStop stock in a coordinated attempt to screw over hedge funds that bet the video game retailer’s stock would tank. After sending GameStop stock soaring 400% in a week, Reddit users set their sights on other beleaguered companies such as AMC Entertainment, Nokia, and BlackBerry to drive up the value of these so-called “meme” stocks.
U.S. regulators have since launched an investigation into short selling and online trading platforms, including Robinhood, the stock trading app at the centre of a class-action lawsuit after it temporarily blocked users from purchasing “meme” stocks amid the buying frenzy.
In his testimony before Congress, Reddit CEO Steve Huffman said that, based on an internal analysis, bots and foreign actors did not play a “significant role” in the GameStop-related traffic on WallStreetBets, CNBC reports. However, an analysis by PiiQ Media, a startup that studies social media risks, found that bots on YouTube, Twitter, Instagram, and Facebook helped fuel the buying frenzy, although the scope of their influence remains unclear.
The firm studied patterns of keywords related to the GameStonks saga across posts and profiles from January through Feb. 18. These keywords included “GME,” the ticker symbol for GameStop stock, and “Hold the Line,” a viral call for investors not to dump their GameStop shares as prices began to come down from their historic heights.
PiiQ Media found similar “start and stop patterns” among GameStop-related posts, with activity spiking at the beginning and end of each trading day — a pattern that’s indicative of bots, the firm’s co-founder and chief technology officer, Aaron Barr, told Reuters.
“We saw clear patterns of artificial behaviour across the other four social media platforms. When you think of organic content, it’s variable in the day, variable day-to-day. It doesn’t have the exact same pattern every day for a month,” he said.
PiiQ Media estimates that tens of thousands of bot accounts participated in the campaign to hype up GameStop and other “meme” stocks. While the firm didn’t include Reddit posts in its analysis, Barr told Reuters he would expect to see similar patterns of bot-like activity on the platform.
When asked about the study, a Twitter spokesperson said “bots” have become an umbrella term for a range of online activity and pointed us to a company blog post debunking a few common misconceptions about bots and platform manipulation. They also shared the following statement:
“People often refer to bots when describing everything from automated account activity to individuals who would prefer to be anonymous for personal or safety reasons, or avoid a photo because they’ve got strong privacy concerns. The term is used to mischaracterize accounts with numerical usernames that are auto-generated when your preference is taken, and more worryingly, as a tool by those in positions of political power to tarnish the views of people who may disagree with them or online public opinion that’s not favourable.”
YouTube and Facebook did not immediately respond to Gizmodo’s requests for comment. We’ll update this blog if we hear back.
The U.S. Securities and Exchange Commission is also reportedly looking into the GameStonks saga for signs of illicit market manipulation and fraud. On Friday, the agency temporarily blocked trading in 15 companies over concerns that their stock prices were being artificially inflated, per a Bloomberg report.
“We proactively monitor for suspicious trading activity tied to stock promotions on social media, and act quickly to stop that trading when appropriate to safeguard the public interest,” Melissa Hodgman, acting director of the SEC’s enforcement division, said in a statement to the outlet.
It’s entirely plausible that retail investors or other interested parties tried to capitalise on the GameStop fervor with automated campaigns. But since the scope of their influence remains unclear, it’s anyone’s guess if these campaigns were a driving force behind the glorious fiasco or just another drop in the bucket.