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Meet the ‘Degen’ Traders Fueling the Latest Meme-Stock Mania

Short for ‘degenerates,’ their risky style of trading has come roaring back in recent weeks. ‘It’s still better than a lottery ticket.’

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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. 

“It’s quick money,” said 39-year-old Daniel Moravec, a former professional poker player who identifies as a degen trader. “Buying some options or going for a high-risk stock—it’s still better than a lottery ticket.”


Day trading exploded during the pandemic when people were stuck at home and pocketing extra cash from stimulus checks. Apps like Robinhood made trading easy and fun, while moves by brokerages across the industry to eliminate commissions and offer fractional trading made investing cheaper than ever. 

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These days, investors bet on everything from digital tokens they know have no underlying value, to risky options that could be worthless within minutes or hours. Robinhood launched 24-hour trading last year and expanded the number of stocks it offers in its overnight session this year, making it easy for degens to pounce on stocks around the clock and attempt to capture the momentum in certain shares.

For many of these degens, an online trader named Keith Gill is their ultimate hero—though he himself identified as a value investor. Known as “Roaring Kitty” or “Deep F— Value,” he helped lead the meme-stock revolution in 2021 by betting big on GameStop and posting about his investments online. Newbie investors banded together to join him, sending shares of the struggling videogame retailer soaring. They burned hedge funds betting against the stock and caught the attention of Congress, regulators and Wall Street. Gill’s last Reddit post in 2021 showed that his GameStop fortune had swelled to about $30 million.


Since then, trading volumes across brokerages have dropped from pandemic-era highs. Many day traders went back to their day jobs.

Some on Wall Street wondered if the meme-stock movement was a blip. But the die-hards stuck around. Pockets of the market have morphed into a casino along the way.

Roaring Kitty’s reappearance on X last month reignited the trading frenzy in GameStop and other meme stocks. On Sunday, an account tied to Gill shared a screenshot on Reddit showing a more than $180 million position in GameStop, starting another round of roller-coaster action. The stock has more than doubled in the past month.

A boom in long-shot bets tied to GameStop and other degen favorites has helped send average daily volumes in options to almost 47 million this year, the highest level on record in Options Clearing Corp. data going back to 1973. Much of this activity is concentrated in short-term trades that allow investors to score big, or lose everything.

For example, a trader scooping up an option tied to GameStop jumping to $20 ahead of the recent ascent could have enjoyed returns of more than 2,000%, Cboe Global Markets data show.


The stock market has been flying high and the S&P 500 has notched a nearly 11% annualized return over the past 10 years. Meanwhile, many money-market funds are offering nearly risk-free yields of around 5%, some of the highest levels in more than a decade. 

Still, some degens say returns from more staid investments just aren’t enough. They are hungry for fatter profits—and hoping a big win could make a meaningful difference in their lives.

While data show the U.S. economy is strong, inflation has jacked up the cost of trips to the grocery store and rent. The Federal Reserve’s efforts to tame price pressures through higher interest rates have made mortgages more expensive.

Young people especially see record-high home prices and mountains of student debt, and some of them worry they will never make enough money to reach the milestones prior generations did. Long-running surveys of young Americans show Generation Z has emerged from the pandemic feeling more disillusioned than any living generation before it.



What lessons are there to be learned from the ‘degen’ style of trading? Join the conversation below.

Matt Kielczewski, 32, said he started investing in crypto in 2017 because he was drawn to “the promise of financial freedom.” He had opened an account on Coinbase to buy tickets to an eclipse festival that required him to pay in bitcoin. The $10 left in the account turned to $100 in six months.

“That was my ‘Aha’ moment,” he said. “This magic internet money is changing lives.”

He was making a living as an underground DJ in Colorado when Covid hit and wiped away his income. Now he works in marketing in the crypto industry and lives in Lisbon.


At first, degen trading made him feel like he was part of something bigger than himself: a community of like-minded people. Since then, he’s grown worried about scammers and now sees “the massive toxicity that exists in the space.” He still trades every week, but takes more of a buy-and-hold approach to crypto now.

Cryptocurrency trading volumes on centralized exchanges surged in March to the highest level on record, according to crypto-data provider CCData. That includes trading in bitcoin, as well as degens investing in so-called meme coins that are created for fun and often reference inside jokes that are popularized online. A coin called Dogwifhat, tied to a viral image of a Shiba Inu dog wearing a pink hat, was worth pennies to start the year and recently traded around $3.36, notching a gain of more than 2,000%. There’s even a Degen coin, which has swung wildly.

The share of U.S. stock trading that’s in penny stocks has also jumped this year, rising to 14% through May, a high in Cboe Global Markets data going back to 2016. 

Degens and their ilk are also flocking to online sports betting. The National Collegiate Athletic Association surveyed 3,527 individuals between the ages of 18 and 22 last year and found that 67% of students living on college campuses bet on sports.


It’s difficult to pin down exactly where the term “degen” originated or how many traders identify as such. Many say it was adopted by crypto communities before expanding to other markets. Some started seeing the term during “DeFi Summer” in 2020, when money flooded into a part of the crypto world known as decentralized finance. 

What’s clear is that the term—and the style of trading—is catching on. As mentions of “degen” and “degen trading” mushroomed online in May, the share of options activity that stemmed from individual investors surged to more than 18% that month, the highest level since at least August 2020, according to data from J.P. Morgan Global Quantitative and Derivatives Strategy. 

A trader might say they are “degening” into something like a meme coin. It’s similar to traders calling themselves “apes” or saying they are “aping” into an asset by taking a big position. There’s valor in sticking together, coordinating trades on platforms like Reddit or Discord. Those who take these big risks are lionized by their peers.

“In internet parlance, ‘degen’ can actually be a term of endearment,” said Dustin Burnham, a 41-year-old anesthesiologist assistant in Melbourne, Fla.  “It can imply a willingness to take risk that others wouldn’t to achieve a goal.”


He says he doesn’t consider himself a degen investor, though some of the online communities he’s active in are littered with ape emojis. 

Few individual investors see even a fraction of the wealth that Gill has appeared to attain. A 2023 academic study found that many individuals overpay for trades in the options market and end up with losses, particularly around events like earnings. Many investors haven’t timed crypto particularly well, either. New users flocked to crypto around the time prices peaked in 2021, for example, and some were left with giant losses in the subsequent tumble. 

After the 2021 GameStop saga, the Securities and Exchange Commission has sought to curb what regulators see as the gamification of trading by proposing guardrails on trading apps. The initiatives so far have met heavy opposition from the brokerage industry and Capitol Hill.

María Paula Fernández, a 38-year-old in Berlin, started trading crypto in 2017 and works in the crypto industry. Her home country of Argentina restricted foreign currencies, so the freedom and transparency that crypto promises appeals to her.


Though she has traded her fair share of meme coins and likes to have fun in the markets, she is skeptical of the degen ethos.

“It ends up shaping your way of seeing things. You’re not looking at things as financial instruments anymore,” she said. “You’re just absorbed into this micro-culture.”

Write to Hannah Miao at hannah.miao@wsj.com and Gunjan Banerji at gunjan.banerji@wsj.com


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