The meme stock frenzy, driven by social media discussions and retail buying, has once again swept through the financial markets. Its core logic remains unchanged, still targeting companies that are severely shorted and in distress.
The U.S. stock market has once again been engulfed by the meme stock frenzy. In mid-July, a group of underperforming companies, including Opendoor Technologies, Kohl's Corp., and Krispy Kreme, saw their stock prices skyrocket. This surge was not based on changes in the companies' fundamentals, but because they became the focus of discussions among a few well-known figures on social media, attracting a large influx of retail investors.
This round of market activity is reminiscent of the surges seen in 2021 with GameStop and AMC Entertainment, targeting the same vulnerable companies that were packaged by internet celebrities as &#34;challenging Wall Street professionals.&#34; For example, Opendoor's stock price soared 43% on July 21, with a trading volume reaching 1.9 billion shares, accounting for nearly 10% of the total trading volume in the U.S. stock market that day. The activity in the options market even exceeded the single-day peak during the 2021 GameStop frenzy.
This meme-driven surge in stock prices may bring unexpected wealth worth billions to a few, but for investors who buy in at high prices, it means a significant risk of loss. Since the trading logic is almost entirely detached from the company's business performance and prospects, the risks of participating in meme stock trading are extremely high.
<h2>The Old Script Repeats: Common Characteristics of Meme Stocks</h2>
The repeated emergence of meme stock frenzies stems from the fact that the target stocks share some common characteristics. Firstly, they can ignite the imagination of internet communities and are promoted through opinion leaders on social media. These promotions are often accompanied by images and videos that incorporate elements of popular culture, known as &#34;memes.&#34;
Secondly, buying these stocks is seen as a symbol of identity or a way to join a specific community, with investors encouraging each other to buy within the community. Whether it was the protagonists of 2021, GameStop and AMC, or the current round with Opendoor, Krispy Kreme, and Beyond Meat Inc., most are well-known consumer brands.
Additionally, these companies often have two key characteristics: One is that they are heavily shorted by professional investors, meaning there are significant short interests; the other is that their stock prices are relatively low, providing retail investors with a lower barrier to entry. When a short squeeze occurs, short sellers are forced to buy back shares to cover their losses, further propelling the irrational rise in stock prices.
<h2>A Different Era: How is the 2025 Frenzy Different?</h2>
Although the script is similar, the market environment in 2025 is drastically different from four years ago. In 2021, investors were at home due to the pandemic and held stimulus checks issued by the U.S. government, exchanging investment insights on social platforms. Currently, the market is facing pressures from high interest rates and uncertainties in trade policies, making the resurgence of speculative corners particularly prominent
According to media reports, the number of stocks involved in this round of Meme stock frenzy is fewer than in 2021, but the upward momentum is more unstable and often short-lived. For example, the stock price of donut maker Krispy Kreme soared 39% at the opening on July 23, but closed only up 4.6%, with the increase significantly narrowing.
This transient nature is partly due to Wall Street institutional traders having established a set of strategies to quickly identify and respond to Meme-driven market movements, which often leads to a rapid loss of momentum.
<h2>Influencers and Regulation: The Drivers and Controversies Behind the Frenzy</h2>
Behind every frenzy, one can almost trace back to posts on social platforms like Discord, Reddit's WallStreetBets section, or trading chat rooms like StockTwits. In 2021, it was investor Keith Gill (online name Roaring Kitty) whose bullish posts ignited the GameStop rally.
In the events of July 2025, Eric Jackson, founder of Toronto hedge fund EMJ Capital, posted a series of messages on social platform X encouraging buying, which made Opendoor the focus of retail investors' discussions and quickly landed it on the most active trading list on StockTwits.
The legality of such actions is highly controversial. The U.S. Securities and Exchange Commission (SEC) is responsible for regulating market manipulation, but must prove manipulative intent. If someone promotes a stock to drive up its price and profit from it, it may constitute illegal activity.
Critics argue that promoters of Meme stocks often do not disclose key information such as their position size, trading times, and whether they receive promotional fees. However, others argue that this is no different in essence from activist investors pushing for change or short-selling institutions releasing reports for profit.
<h2>Why is the Frenzy Hard to Sustain?</h2>
The frenzy surrounding Meme stocks is often difficult to sustain because it requires a continuous influx of new investors to maintain upward momentum. In 2021, pandemic restrictions and market conditions contributed to this requirement.
However, recent cases show that the duration of the frenzy is becoming shorter. In May 2021, AMC's stock price increase lasted only two days before turning downward; in 2024, Faraday Future Intelligent Electric Inc.'s stock price soared from about $0.04 to nearly $4 within a week, but fell back to penny stock status in less than two weeks.
Ultimately, as demonstrated by AMC and GameStop in 2021, the core driving force behind the rise of Meme stocks is the collective sentiment of retail investors challenging the Wall Street establishment, but the fundamental business performance of companies will eventually play a decisive role, signaling the end of this carnival.
Risk Warning and Disclaimer
The market has risks, and investment should be cautious. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Investment based on this is at one's own risk

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The meme stock frenzy has once again swept through the financial markets, primarily driven by discussions on social media and retail buying. Recently, companies like Opendoor, Kohl's, and Krispy Kreme have seen significant stock price increases, not based on fundamentals, but due to social media attention. Such stocks typically possess characteristics that ignite the imagination of the internet community and are seen as status symbols. While a few may profit, investors who buy at high levels face substantial risks of loss

- The resurgence of Meme stocks in the financial market is driven by social media discussions and retail investor buying, targeting heavily shorted companies.  
- Recent examples include significant price surges for companies like Opendoor Technologies and Krispy Kreme, not based on fundamentals but rather on social media hype.  
- The current market environment differs from 2021, with higher interest rates and increased volatility, leading to shorter-lived price increases and ongoing debates about market manipulation.

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