The chat service believed that WallStreetBets was sowing too much chaos, but not because the group had been fueling GameStop stock.
A group chat application, Discord, has banned the server related to r/WallStreetBets, the group of rookie day traders who have grouped to push the price of GameStop stock up over 1,000% in two weeks.
Before January, WallStreetBets was just a little-known subreddit for everyday people to talk about stocks. However, according to Discord, chatter for the group over on Discord was “hateful and discriminatory.”
A discord spokesperson wrote in a statement to the Financial Times and other media outlets:
“The WallStreetBets server has been on our Trust & Safety team’s radar for some time due to occasional content that violates our Community Guidelines, including hate speech, glorifying violence, and spreading misinformation….To be clear, we did not ban this server due to financial fraud related to GameStop or other stocks.”
While the explanation is believable, the timing raises doubts to several people. The Securities and Exchange Commission, without naming GameStop or WallStreetBets, has referenced the situation in a one-sentence public statement recently:
“We are aware of and actively monitoring the on-going market volatility in the options and equities markets and, consistent with our mission to protect investors and maintain fair, orderly, and efficient markets, we are working with our fellow regulators to assess the situation and review the activities of regulated entities, financial intermediaries, and other market participants.”
Also, Adena Friedman, the CEO of the stock exchange Nasdaq – which does not list GameStop Stock – stated today that there is an open question whether social-media boosted buying sprees match the regulatory definition of pump-and-dump schemes.
For the time being, it is hard for the public to get a grip on what is going on inside r/wallstreetbets. As of now, the Reddit group is invite-only.
“We are experiencing technical difficulties based on an unprecedented scale as a result of the newfound interest in WSB,” the subreddit page now states. “We are unable to ensure Reddit’s content policy and the WSB rules are enforceable without a technology platform that can support automation of this enforcement. WSB will be back.”
All of this comes amidst a rapidly changing landscape for social media and internet forums. Purges about QAnon and alt-right accounts on Twitter have led users to look for safe havens somewhere else like on Parler and Gab, but also to messaging apps.
The capability of tech platforms to unilaterally sanction speech, hateful and violent or otherwise, and has even some tech CEOs concerned, given the pervasiveness of a handful of platforms. Twitter CEO Jack Dorsey, a Bitcoin enthusiast, has initiated the Bluesky initiative as a chance to create a decentralized social media standard.
A newly released ecosystem review for Bluesky, written by former Zcash software engineer Jay Graber, has explored federated servers like Mastodon and Reddit alternatives like Aether.
Such systems will guard against censorship of groups like the WallStreetBets, leaving them free to pump whatever stock they want in whatever manner they wish.
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