The New York Stock Exchange (NYSE) has placed a Short Sale Restriction (SSR) on GameStop (GME) after the stock experienced a massive spike in short-selling activity, reminiscent of the 2021 short squeeze that rocked Wall Street.
Data from TradingView shows GameStop’s short sales volume soared by 234% in just 24 hours, reaching 30.85 million shares sold short on March 27. The NYSE SSR rule is automatically triggered when a stock declines by more than 10% from its previous day’s close.
GameStop’s stock plunged 22% during the trading session, erasing the 12% gain it had made following a recent Bitcoin-related announcement. At the time of reporting, GME shares were trading at $22.09.
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Short Sale Restriction Limits GameStop Shorts Through Next Trading Day
Under SSR rules, restrictions are enforced for the remainder of the trading day and the entire next day, limiting short selling to prices above the current national best bid.
Kevin Malone, CEO of Malone Wealth, highlighted the trading volume’s significance, noting in an X post that “GameStop traded 50 times more shares today than last Thursday. Not statistically possible without naked short-selling.”
GameStop Corp $GME traded 50x more shares today than last Thursday. Not statistically possible without naked short selling. pic.twitter.com/vBIL8IeFc6
— Kevin Malone (@Malone_Wealth) March 27, 2025
The short-selling volume neared levels last seen during January 2021, when GameStop’s stock price skyrocketed in a viral retail investor-led short squeeze. At its peak on January 19, 2021, GameStop saw 33.26 million shares sold short.
The current spike is the second-highest since then, trailing only the June 3, 2024, high of 46.2 million shares, which occurred shortly after retail trader Keith Gill—known for sparking the original 2021 rally—returned to trading GameStop with a $180 million position.
GameStop recently announced a $1.3 billion convertible notes offering, which may be used in part to purchase Bitcoin, though the company has not disclosed how much it plans to allocate.
Some market analysts have expressed skepticism. Speaking to Yahoo Finance, Tastylive CEO Tom Sosnoff said the move felt “a little dot-comish,” suggesting the company lacked a solid growth strategy.
Some believe the convertible debt offering could be contributing to the stock’s decline.
Analyst Han Akamatsu drew parallels with MicroStrategy’s 2021 dip after a similar convertible note issuance, suggesting GameStop could be setting the stage for a potential short squeeze if Bitcoin or GME shares rise significantly.
$GME SSR Rule is on for tomorrow.
They can still short, but only if the stock moves up before they can short into it.
Smashing the bid over and over is restricted. pic.twitter.com/oVHumcv5XS
— Han Akamatsu 赤松 (@Han_Akamatsu) March 27, 2025
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GameStop Joins Corporate Bitcoin Trend with New Investment Policy Update
On March 25, GameStop revealed that its board of directors had unanimously approved a revised investment policy, granting the company the ability to diversify its reserves by purchasing Bitcoin.
Under CEO Ryan Cohen, GameStop has been exploring new approaches to counteract declining physical retail sales—net sales fell from $5.27 billion in 2023 to $3.82 billion in 2024—and increasing competition from digital gaming platforms.
As of February 1, GameStop held over $4.7 billion in cash reserves, mainly from cost-cutting measures and equity offerings.
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Key Takeaways
- The NYSE imposed a Short Sale Restriction on GameStop after a 234% spike in short-selling volume led to a 22% stock drop.
- Analysts suspect potential naked short-selling and are drawing comparisons to the 2021 GameStop short squeeze.
- GameStop’s new $1.3B convertible notes offering and Bitcoin investment plan have sparked both interest and skepticism among investors.
The post NYSE Imposes Short Sale Restriction on GameStop as Short Interest Surges 234% appeared first on 99Bitcoins.
