Riot Blockchain Inc (NASDAQ: RIOT) is falling again in the market today, following up on recent declines after the short selling firm, Citron, released a report about the company. However, after digging through the Wall Street Bets Reddit, it’s clear that now may be the time to buy as yet another big short squeeze is on the horizons.
Here’s what’s happening:
Citron Wages Attack On Riot Blockchain
In a note, Citron pointed to Riot Blockchain as one of the most overvalued stocks on the market today, saying that the stock is trading at a 3,000% premium to its net asset value. In fact, Citron says that the stock is only worth about $2 per share when you account for their assets, including mining machines, infrastructure, and more.
This came as a surprise after the short seller lost massive amounts of money in the GameStop short squeeze. In fact, after the massive losses earlier this year, the firm said it would no longer publish negative reports about publicly traded stocks.
So, the negative report was the first from the firm since that announcement.
Now Is The Time To Jump In
I’ve never been a big fan of Citron, Hindenburg Research, or any of the other big short sellers on the market. Ultimately, these firms have made massive amounts of money by sending stocks for dramatic, often unwarranted, declines.
I’m not the only one with that opinion either. In fact, the Big Short Squeeze was all about handing short selling hedge funds a taste of their own medicine, and I’d venture to bet that Citron is gearing up for another taste.
In fact, members of the Wall Street Bets Reddit, the same team that caused the big short squeeze in GameStop that ended up costing Citron billions of dollars, is already jumping all over the report, with messages across the platform pointing to the idea that the firm didn’t learn its lesson. Just look at the message below:
The fact of the matter is that retail investors are tired of big-money players leading to declines that take money out of their pockets, only to make the rich richer.
Considering the messages across the Wall Street Bets Reddit platform, and the recent declines seen in RIOT stock as a result of Citron’s report, I believe that the stock is gearing up for a short squeeze.
The Bottom Line
The bottom line here is that until regulators step in and force firms like Citron and Hindenburg Research to play on the same playing field as retail investors, we’re going to see massive short squeeze opportunities.
Ultimately, retail players aren’t going to have rich guys digging in their pockets anymore.
Considering that this is the first ammunition fired back at short sellers since the Big Short Squeeze started, I’m expecting to see a concerted effort to hand Citron significant declines through a short squeeze, creating an opportunity for retail investors.