Meet the ‘degen’ traders fueling the latest meme-stock mania
Degenerates are swarming the stock market. A risky style of trading is roaring back in popularity, driven by amateur traders who call themselves “degens" and pile into long-shot trades that proudly have nothing to do with conventional ways of assessing investments. Some are flinging cash at specific stocks or cryptocurrencies just to be part of a movement.
Others are sticking around for the jokes and memes. “Degen" can be a noun, adjective or verb in their language, shared mostly among young men. It’s a self-deprecating identity that some have traced back to the term “degenerate gambler." Behind it is an ethos that values audacious bets on the market and is skeptical of investment norms: You only live once, so why bother with traditional financial advice? Through online aliases and in chat rooms, these self-proclaimed degens brag about buying little-known digital tokens, meme stocks and speculative options contracts.
They are generally drawn to assets more for the excitement around trading them than their underlying fundamentals. There’s a potential for near-instantaneous profits, or huge losses if the bets go south. Degens are part of the fuel for meme-stock mania, like the logic-defying action in GameStop shares in recent weeks.
When these internet-fueled traders stick together, they have the potential to spark wild swings in assets. All it takes is for a meme to catch fire. In May, when everything from major indexes to meme stocks soared, social media lit up with references to “degen" and “degen trading." There were more than 370,000 mentions of “degen" and its variations across social-media platforms like Reddit and X, up from fewer than 1,000 the prior month, according to Hootsuite’s social-media performance engine.
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