Social Media bots are responsible for GameStop hype, analysis shows

An analysis by cyber security company PiiQ Media has revealed that bots on major social media platforms have been hyping up GameStop and other “meme” stocks.

This revelation suggests that organized economic or foreign actors may have played a role in the Reddit-driven trading frenzy.

Shares in 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, Facebook Inc, 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 that 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.

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 spokesperson for Twitter said that “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 Securities and Exchange Commission is probing the GameStop saga, and this month suspended trading in a handful of companies because some “social media accounts may be engaged in a coordinated attempt to artificially influence” their stocks.

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