WallStreetBets combats market manipulation using blockchain
WallStreetBets, the Reddit-based grassroots movement that achieved notoriety for short-squeezing hyper-leveraged financial firms, has launched a new blockchain-based application aimed at combating market manipulation in traditional finance.
The group announced the creation of WallStreetBets Exchange Traded Portfolios, or ETPs, that can provide investors with broad exposure to various assets in a completely decentralized manner. The group explained:
“WallStreetBets ETPs may serve as an alternative to kind of the market manipulation by opaque and politically connected banks and hedge funds.”
The product is powered by a decentralized autonomous organization, or DAO, which means portfolio rebalancing is the sole domain of community members who exercise their rights through the forthcoming WSB token. Although the group didn’t specify when the new product will launch, it has reportedly engaged experts from the fields of blockchain and fintech to design the new offering.
Jaime Rogozinski, the founder of WallStreetBets, called the merger between blockchain and financial markets as the “next logical step for finance,” adding that “it will result in stronger, more democratized markets and will empower individuals around the world.”
The r/WallStreetBets Reddit community currently has 10 million members, having more than doubled since late-January when the GameStop drama first unfolded. WallStreetBets burst into the spotlight after its community collectively gobbled up shares of heavily shorted GameStop and AMC stocks, sending their price soaring — and torching short-selling hedge funds in the process. Wall Street’s best and brightest betting against these so-called “meme stocks” lost over $5 billion on the ordeal.
Despite building its latest product on the blockchain, WallStreetBets recently moved to ban all cryptocurrency-related discussions after Bloomberg soured over the group’s alleged infatuation with the digital asset market. Subreddit moderator u/bawse1 explained:
“Due to the article that was written [by] Bloomberg who somehow felt that ‘WallStreetBets Bows to Crypto.’ Crypto discussion is banned indefinitely. I’ve read a lot of dumb articles written about wsb. This one takes the cake. P.S. Like always. Please be respectful.”