LBank Observation: Overnight Surge of 433%, Retail Investor's Light "GME" Escalates Fight Against Wall Street

According to LBank news, influenced by the stock market circuit breaker news of Gamestop, its MEME GME went viral on social media in a short time and surged 433.84% on the cryptocurrency trading platform LBank, with a 24-hour trading volume reaching 134 million USD and a market capitalization exceeding 85 million USD. What caused this sudden surge? The following article will reveal its project history and explain the investment logic of MEME.

Retail Investors Band Together, Crazy MEME Sentiment Spreads

This Monday, the stock price of American game retailer GameStop surged over 74%, causing heavy losses for short sellers of the stock. According to data from analysis firm S3 Partners, hedge funds shorting GameStop lost 838 million USD on that day.

LBank researchers found that the sudden spike in GameStop's stock price seemed to be triggered by internet celebrity Roaring Kitty, who encouraged retail investors to buy GameStop in large quantities in 2021, creating history on Wall Street. Roaring Kitty posted on the X platform for the first time since 2021, sharing a photo of a gamer focused on gaming, implying that the "game" has begun.

According to Kookonchain detection, a savvy trader started buying GME 30 minutes after @TheRaringKitty's tweet, spending a total of 443 SOL (approximately 65,000 USD) to purchase 44.86 million GME, then sold all of it for 2,302 SOL (approximately 336,000 USD), earning 1,850 SOL (approximately 271,000 USD) in just 14 hours.

This impact is still ongoing, with overseas famous KOL AlΞx Wacy also posting on Twitter to affirm the strong influence of retail investors represented by memes.

However, this is not the first time that retail sentiment has led to a meme frenzy.

Reviewing the Short Squeeze War in the U.S. Stock Market, Retail Investors Strike Back at Wall Street

In 2021, due to the pandemic and the impact of the internet, Gamestop was maliciously shorted by Wall Street funds, which sparked dissatisfaction among Reddit forum users. They spontaneously initiated a counterattack on social media, calling on others to buy Gamestop stock to drive the price back up, causing heavy losses for short-selling companies. The media portrayed it as a story of retail investors rising against the establishment.

This event is also referred to as a battle between urban classes ignited by the internet, showcasing the fervor of retail investors.

This incident also drew the ire of Tesla CEO Elon Musk, who tweeted "Gamestonk" on January 26, along with a link to Reddit, interpreted as support for retail investors fighting back against Wall Street, which pushed the event to a climax.

Excessive Speculation and Value Coexist, Class Opposition Between VCs and Retail Investors

With the frenzy of MEME being widely accepted by most retail investors, some VCs began to feel uneasy. Top VC a16z has been criticizing meme coins, with its CTO lamenting on Twitter that "Memecoins undermine the long-term vision that keeps many in the crypto space, and are not technically appealing; they are unattractive to builders."

Compound VC managing partner Michael Dempsey also accused that "meme coins have caused a significant loss of true builders."

However, this statement quickly led to dissatisfaction within the crypto community. Retail investors believe that the innovations touted by VCs mostly revolve around creating new buzzwords and FOMO hype, with little actual implementation.

In this market cycle, we clearly see that some value coins praised by VCs have instead been on a downward trend. Many retail investors have been manipulated by grand narratives and high market caps, a typical example being the token MERL of "Merlinchain," which peaked upon listing but then fell continuously, with subsequent value empowerment failing to reverse the overall downward trend.

Undeniably, memes have injected a new force into market sentiment cultivation, especially with the high number of active addresses and trading volume on new chains like BASE and Solana, which are closely related to the effectiveness of meme dissemination. These traffic drivers are essential for new chains to break market perceptions and quickly gain more attention as the most direct form of "mass application."

How to Better Invest in MEME?

Currently, there is a lagging correlation between the primary and secondary markets, with potential factors led by VCs being influenced by retail sentiment represented by memes, whose returns far exceed the investment returns of market projects. Below, we will explain how to better invest in MEME. The cryptocurrency trading platform LBank has launched a MEME special section, and we will use this as an example to explain the logic of MEME.

The entire investment in memes should revolve around speculative elements, rotation cycles, and investment thinking.

1. Speculative Elements: This part is more related to the market celebrity effect and hot events. There is a continuous wealth effect and coins that create topic heat. Only then can they consistently attract market attention, draw in more users, and build a better reputation. For example, LBank's recent launch of the U.S. Trump campaign TRUMP and GameStop GEM has better focused on market hotspots, creating a logic for over 50% gains.

2. Rotation Cycle: In this market cycle, due to the approval of the BTC ETF, U.S. institutions are more inclined towards Bitcoin investment, so the market inflow of "value coins" is not very obvious. In contrast, memes, with their inherent "speculative points" and low unit prices, are easily accepted by retail investors and can spread quickly. Recent meme launches on LBank, such as CATGPT, POPCAT, and MICHi, are typical examples.

3. Investment Thinking: This stage mainly involves comparing the acceptance capacity of retail investors with the listing situation and market capitalization of the token. If it is in a secondary exchange like LBank, it is still in the early stages, and investors can make market investments based on their own situations.