The Redditor revolt that dropped stock markets in recent weeks owes its origins, in part, to a humpback whale called Mister Splashy Pants. In 2007, Greenpeace asked the public to decide on the name of a whale in the South Pacific Ocean for an awareness campaign on hunting in Japanese fisheries. A group of pranksters rallied on Reddit’s nascent message board to hijack Greenpeace’s online poll and push its chosen name. The organization and netizens clashed for weeks until Greenpeace finally relented and Mister Splashy Pants was crowned.
Two years later, Reddit Inc. co-founder Alexis Ohanian recounted the gag in a TED Talk. “In the last four years, we’ve seen all kinds of memes, all kinds of trends have been born on our homepage,” he said. “This is how the Internet works. This is the big big secret. The Internet provides a uniform playing field. “
The Greenpeace caper was such a significant event for the company that Reddit temporarily changed its logo to a whale flexing its biceps fins. Mister Splashy Pants would offer a model for Reddit, modeled for more than a decade, that resulted in cultural stones and charitable causes, as well as organized harassment and dangerous conspiracy theories. It also provided a first roadmap for WallStreetBets, a forum for amateur traders who used Reddit to incite stock market frenzy.
Alexis Ohanian
Photographer: David Paul Morris / Bloomberg
“The message no longer comes from top to bottom,” Ohanian said in the 2009 speech. “You have to be okay to lose control.”
Reddit has long cultivated a reputation for being a place where everything goes. The best and worst of the internet was completely displayed. Reddit took small steps last year to reduce the ugliest behavior by introducing its first hate speech policy. But it’s still a place where controversy is allowed, hijinks are encouraged and a joke can quickly get out of control.
The commercial crusade of the last couple of weeks, which raised the price of shares of nostalgia as GameStop Corp i AMC Entertainment Holdings Inc., was partly a joke and partly a way to punish hedge funds that restricted these actions. It worked. Ohanian, who left the Reddit board last year, and its co-founder Steve Huffman, joined the populist argument. The founders, both 37, have said WallStreetBets demonstrates that people can come together to influence established institutions.
“I think that’s something for a lot of people, which was a statement as much as an investment,” Ohanian said in an interview with Bloomberg TV. Huffman, the CEO, described it as a “Wall Street cultural war against everyone.”
But the victims extend beyond hedge funds and securities trading applications such as Robinhood Markets Inc., which he was quick to seek emergency capital to cover volatility risks. U.S. regulators are examining posts on social media for clues possible fraudulent activity behind the shops. Now, as fashion stocks sink, those who bought high don’t laugh out loud as much as before. “Last week I was looking at the phone non-stop and it was wearing me down,” said Scott Smith, a Reddit user who lost about $ 1,300 on GameStop stock trading. “I’ll take a long break and focus on my student loans before I think about stocks again.”
Steve Huffman
Photographer: David Paul Morris / Bloomberg
Ohanian and Huffman met as students at the University of Virginia, where they started Reddit with another classmate in 2005 as a place to share and discover web pages and news articles. They joined the inaugural class of a new business incubator in Silicon Valley called Y Combinator. With $ 100,000 in venture capital, they cultivated a small population of users who filled the site with their own posts and voted on their favorite content.
Condé Nast, editor of the New Yorker i With cable, acquired Reddit in 2006. In the following years, the founders left; Condé Nast left the business; and a couple of external CEOs tried unsuccessfully to tame the Reddit mafia. One was Ellen Pao, a former venture capitalist of Kleiner Perkins. Pao is critical of the way Huffman, his successor, handles hate speech, harassment and other troubling activities at the site. And with WallStreetBets, he said Reddit didn’t provide adequate guarantees for people caught up in fashion.
“Reddit should add a legal warning because I don’t think the 6 million people on r / wallstreetbets, and the people who followed them, know exactly what they are engaged in,” Pao wrote in an email. (The forum now includes more than 8.6 million readers.) “Being ethical is transparent about risk.”
Huffman’s response to the controversy at the site has been inconsistent and often belated. He has dealt with critics using tactics similar to those of Reddit trolls. On at least one occasion, he secretly edited a lot of comments that were critical of him, for which he later apologized. Pizzagate, a theory of the original internet conspiracy that falsely links Hillary Clinton to a ring of pedophilia, thrived on Reddit before Huffman stepped in to ban the community in 2016.
He allowed another group, The_Donald, to spread racist messages for years. In an interview with the New Yorker in 2018, Huffman said some forum people were simply expressing political beliefs, “and that’s something we want to encourage.” Reddit banned the group last summer and then ousted a similar group last month after members attacked and celebrated the violence at the U.S. Capitol. Reddit refused to make Huffman available for an interview.
The basics of Reddit have been around since the early days of the network. People shared tips on stock trading on Yahoo! message boards and surveys conducted in GeoCities. But there is a certain aspect in the Reddit system, in which anyone can vote virtually anything from the site up or down, which extracts the inner shock of users. Some treat it like a game, Huffman said New Yorker: “‘If I post this ridiculous or offensive thing, can I get people to vote for it?’ And then some people, to name a few The Dark Knight, I just want to see how the world burns. “
Reddit controls “bad stuff” on the site, Huffman said in a conversation last month on the social media app Clubhouse, using an internal metric called “daily active shit.” WallStreetBets has not reached the punishment threshold on Reddit, despite being slapped with a hate speech ban by Discord, another app that usually takes a gentle approach to moderation. WallStreetBets is by no means perfect, but they have been well within the limits of our content policy, Huffman said.
Huffman has described it as one of his favorite communities on the site. “Isn’t it funny that WallStreetBets is now the glue that binds most of America right now?” Huffman said at the Clubhouse.
Mark Luckie, a former Reddit media chief, has been critical of the company for its lack of intervention on racist and hateful content, but does not consider WallStreetBets to be problematic. “They are people who talk to each other to improve their financial future. I don’t think there’s a problem, ”Luckie said.
In recent days, the tone of WallStreetBets, once cheerful about sticking it to finance rates and making a fortune in the process, has become a bit negative. The board is full of comments about how much money members have seen disappear from their Robinhood accounts.
Smith, a Reddit user and former GameStop shareholder, had never traded before being sucked into WallStreetBets about a year ago. He lives near Austin, Texas, where he develops business intelligence software. Smith bought some shares on GameStop on January 27 and then more the following week. He reasoned that he could afford to join the movement: “I saved a lot of money in 2020 by not eating out because of quarantine.”
Feeling stressed by stock fluctuations, Smith sold all of his shares when the share price reached $ 79. He then bought it back for $ 67. “That fear of losing me is hitting me hard,” he said. On Friday, when the stock closed at $ 63, Smith declared, “I’m officially done.”
Huffman expressed concern about the financial well-being of its users, but also hesitated to do anything about it. “I am just worried about them. But it would not allow this to extend to paternal action how to protect them, ”he said in one New York News podcast interview posted last week. “Hey, look, I’d worry about people jumping off a cliff into the river too. It is a fundamentally dangerous activity. But I also believe that people are free to make decisions. ”