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Bots hyped up GameStop on major social media platforms, analysis finds

TechnologyFeb 26, 2021 04:10PM ET
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© Reuters. FILE PHOTO: FILE PHOTO: GameStop logo is seen in front of displayed Reddit logo in this illustration

By Michelle Price

WASHINGTON (Reuters) - Bots on major social media platforms have been hyping up GameStop Corp (NYSE:GME) and other "meme" stocks, according to an analysis by Massachusetts-based cyber security company PiiQ Media, suggesting organized economic or foreign actors may have played a role in the Reddit-driven trading frenzy.

Shares of GameStop soared last month after Reddit users banded together to squeeze hedge funds that had bet against the video game retailer and other companies. Reddit Chief Executive Steve Huffman told Congress this month that bots, artificial or fake accounts with automated content, had not played a "significant role" in GameStop Reddit message traffic.

PiiQ Media's analysis of Twitter Inc (NYSE:TWTR), Facebook Inc (NASDAQ:FB), Instagram and YouTube posts, however, found that bots used the platforms to push GameStop and other "meme" stocks, although it is unclear how influential they were in the overall saga.

A startup that focuses on social media risks, PiiQ said it examined patterns of keywords such as "Hold the Line" and GameStop's stock symbol, "GME," across conversations and profiles prior to the Jan. 28 frenzy, through Feb. 18. For comparison, it also assessed posts on an unrelated set of stocks.

PiiQ said it identified very similar daily "start and stop patterns" in the GameStop-related posts, with activity starting at the beginning of the trading day, followed by a large spike at the end of the trading day. Such patterns are indicative of bots, said Aaron Barr, co-founder and chief technology officer of PiiQ.

"We saw clear patterns of artificial behavior 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.

Based on its authenticity scoring system, PiiQ estimates there are tens of thousands of bot accounts hyping GameStop, the meme stocks, and Dogecoin, a cryptocurrency swept up in the frenzy. Thousands of fake accounts can be purchased for as little as $200, it said.

The company did not analyze Reddit data, but Barr said he would expect to see a similar pattern of activity on Reddit, indicating bot-like or coordinated management of conversations.

A representative for Reddit did not comment beyond Huffman's testimony. Representatives for YouTube, Facebook and its Instagram subsidiary did not respond to requests for comment. The social media platforms generally try to weed out harmful bots, said Barr.

A representative of Twitter said "bots" had become a catch-all term that can often mischaracterize the nature of the account. The company notes bots can be used on its platform for creative or innovative purposes.

The U.S. Securities and Exchange Commission (SEC) is probing the GameStop saga and on Friday suspended trading in 15 companies due to unusual trading activity and apparent attempts on social media to artificially inflate their stock prices. That is in addition to six stocks it recently suspended due to suspicious social media activity.

"We proactively monitor for suspicious trading activity tied to stock promotions on social media, and act quickly to stop that trading," the SEC's acting enforcement director, Melissa Hodgman, said in a statement on Friday.

In addition to traders, organized criminals may use social media to stoke asset prices, and undermining the integrity of U.S. markets is a known goal of hostile state actors, said Barr. But it is unclear how successful, if at all, these types of influence efforts are, he said.

"Measuring the effect of those campaigns is often illusive."

Bots hyped up GameStop on major social media platforms, analysis finds
 

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Comments (7)
Jo Pa
Jo Pa Feb 27, 2021 10:08AM ET
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Hedge funds manipulated the market by bribing Reuters reporters to report fake news on it.
Solomon Roskin
Solomon Roskin Feb 26, 2021 2:36PM ET
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Jouni Matero
Jouni Matero Feb 26, 2021 2:33PM ET
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BS news written with Totally false facts. Shame on you who wrote this ********without proper research. With an hour of facts checking you'd find out what's going on and what's not.
Rajmund Staniek
Rajmund Staniek Feb 26, 2021 1:21PM ET
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"The company did not analyze Reddit data, but Barr said he would expect to see a similar pattern" This is utterly disgraceful and outrageous to even publish such garbage news. research done by a start-up company, Reddit logo in the article banner and yet further down they admit that they did not analyze reddit traffic. What the actual eff.
Nison Kay
Nison Kay Feb 26, 2021 11:33AM ET
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maybe it was "Russia"
Nison Kay
Nison Kay Feb 26, 2021 11:32AM ET
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this is pure garbage.
Madi Azibayev
Madi Azibayev Feb 26, 2021 11:11AM ET
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I woudnt be suprised if these bots are paid by shorters. And nothing about HF bots who is pushing negative sentiments for months!
Madi Azibayev
Madi Azibayev Feb 26, 2021 11:11AM ET
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Madi Azibayev
Madi Azibayev Feb 26, 2021 11:11AM ET
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