"The WallStreetBets server has been on our Trust &
Safety team's radar for some time due to occasional content that violates our
Community Guidelines, including hate speech, glorifying violence, and spreading
misinformation. Over the past few months, we have issued multiple warnings to
the server admin," a Discord spokesperson told Insider.
"Today, we decided to remove the server and its owner
from Discord for continuing to allow hateful and discriminatory content after
repeated warnings," they said.
The move came as Reddit's r/WallStreetBets, an overlapping
online community, has been fueling massive volatility in the stock market over
the past several days by driving up share prices for GameStop, AMC Theaters,
and Nokia.
While the r/WallStreetBets community originated on Reddit,
its members have set up a "server" on the group-chat platform Discord
where they also discuss stock-trading plans.
Discord's ban came as the r/WallStreetBets subreddit had
been experiencing on-and-off technical issues - including becoming invite-only
for around an hour, according to The Verge - as new users flocked to it. The
timing of the ban may have briefly made it more difficult for members to
discuss trades.
Moderators of the Reddit community slammed the move.
"We're suffering from success and our Discord was the
first casualty. You know as well as I do that if you gather 250k people in one
spot someone is going to say something that makes you look bad. That room was
golden and the people that run it are awesome," they said in a Reddit post
Wednesday.
"Discord did us dirty and I am not impressed with them
destroying our community instead of stepping in with the wrench we may have
needed to fix things, especially after we got over 1,000 server boosts. That is
pretty unethical," they said.
But Discord said its decision wasn't connected to the
group's discussion of trading activity.
"To be clear, we did not ban this server due to
financial fraud related to GameStop or other stocks. Discord welcomes a broad
variety of personal finance discussions, from investment clubs and day traders
to college students and professional financial advisors," the spokesperson
said. "We are monitoring this situation and in the event there are
allegations of illegal activities, we will cooperate with authorities as
appropriate."
The trading activity generated in large part by the
r/WallStreetBets community has wreaked havoc on traditional Wall Street firms,
causing GameStop short-sellers alone to lose more than $5 billion on their
positions.
The stock market volatility caused the White House to chime
in Wednesday to say it's "monitoring the situation."
"Our team, our economic team, including [Treasury]
Secretary [Janet] Yellen and others, are monitoring the situation," White
House Press Secretary Jen Psaki said at a press conference. "It's a good
reminder though that the stock market isn't the only measure of the health of
our economy. It doesn't reflect how middle and working-class families are
doing."
Financial regulators and the companies that operate the
financial markets have also been keeping a close eye on the situation.
Nasdaq CEO Adena Friedman told CNBC Wednesday that the
exchange monitors social media chatter, and will halt trading if they match the
chatter with unusual activity in a stock.
Brokerage firm Ameritrade also restricted trading in light
of the massive volume sparked by r/WallStreetBets.
"In the interest of mitigating risk for our company and
clients, we have put in place several restrictions on some transactions in
$GME, $AMC, and other securities. We made these decisions out of an abundance
of caution amid unprecedented market conditions and other factors,"
Ameritrade said in a statement Wednesday.
GameStop, AMC, and Nokia were all down slightly in
after-hours trading.
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