Shares of GameStop (GME) have outperformed Bitcoin’s (BTC) yearly returns in just one day, leading to speculation that some of the profits could flow into the altcoin market, similar to what happened during the previous bull cycle.
According to TradingView, GameStop’s shares have seen a yearly return of over 154%, compared to Bitcoin’s return of over 129%.
The majority of GameStop’s gains occurred in the past two days, with the stock price surging over 105% on May 14th. This increase came after Keith Gill, the man credited with starting the 2021 GameStop short squeeze, unexpectedly returned to social media after a three-year hiatus.
During the COVID-19 pandemic, Gill played a central role in the GameStop saga, where retail traders managed to overpower hedge funds that had shorted the stock. This frenzy resulted in a more than 1,000% monthly price increase for GameStop’s shares.
Following Gill’s return, GameStop’s shares rallied as much as 111% in the 24 hours that followed. During the same period, Dogecoin (DOGE) and Shiba Inu (SHIB) also experienced gains of 6.2% and 5.4%, respectively.
The revival of the GameStop saga has sparked hope in the altcoin market, as the previous bull cycle saw an altcoin rally shortly after the GameStop short squeeze. Historical chart patterns indicate that the altcoin season in 2021 was triggered by the GameStop rally.
Crypto analyst CryptoAmsterdam’s analysis further supports this notion, suggesting that the current market capitalization of altcoins is positioned similarly to the setup that sparked the altcoin bull cycle in 2021.
Rekt Capital’s analysis aligns with this view, predicting that altcoins will find their local bottom in early June before the start of the altcoin season.
While most altcoins have not yet reacted to the GameStop rally, some memecoins, such as Pepe (PEPE), have already gained momentum, reaching a new all-time high above $0.000010 on May 13th.
However, the investing environment on May 14th is different from 2021, with significantly fewer outstanding shorts on GameStop. This could limit the magnitude of the upward movement, according to eToro market analyst Josh Gilbert.
It’s important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and assessment before making any investment decisions.