Author: Mario Chow, IOSG

Three Meme Coins priced in tokenized stocks illustrate who truly controls a short squeeze. Data as of September 7, 2026, 02:15 UTC. Research discussion, not investment advice. Charts in the English version.

Abstract

In January 2021, retail investors were able to force GameStop's shorts to cover because the float was static, and shorts could not create more shares to cover. Ultimately, it was when Robinhood shut off the buy button that the game ended.

Five years later, a batch of Meme Coins has emerged on Robinhood's own chain, with assets priced not in USD but in tokenized stocks of actual publicly listed companies. $BONER is priced based on Hims & Hers, $MEME is priced based on AMC, and $AI is priced based on Nvidia. The accompanying narrative is still short squeeze: buying the coins drives up the price of the tokenized stocks, forcing the institution maintaining the peg to buy real stocks on the secondary market.

We have completely restored all the minting and burning records of tokenized stocks on this chain. To summarize:

On-chain prices can indeed be influenced quickly. However, the issuer will subsequently correct it, usually not lasting more than a morning.

Here are four specific findings.

Money did indeed reach New York. During that weekend with AMC, Robinhood's issuing agent bought and held around $7.6 million of real AMC shares in the secondary market, accounting for 7.6% of the pre-market volume at its busiest. Hence, it is inaccurate to say this system was completely disconnected from the real market.

But the float is now alive, thus the logic of the short and holding gets broken here. The same agent increased the supply of tokenized AMC nineteenfold within three days, from 152,106 shares to 2,895,758 shares. Hims increased from 468 shares to 130,876 shares in that round. The issuer keeps minting beneath your feet, and you cannot lock up any float. In 2021, Robinhood did not allow retail investors to buy. In 2026, it freely sells while conveniently profiting from the spread. The latter defense mechanism is much more effective.

So, what you get is a pin, not a short squeeze. This pin is not small: AMC pre-market peaked at +22%, Farmmi reached +321% during trading, and both returned to roughly their previous levels within a week. Sustaining a short squeeze is because buying back forces out more buybacks. Both times have receded because the mechanism responsible for relaying funds naturally shuts itself off.

Another scale consideration that almost no one has calculated: Even choosing the cheapest targets, pulling off a short squeeze requires $3.4 billion worth of Meme Coins, which is thirteen times the largest project in this chain's history, yielding only about a 9% increase.

It also needs to be clarified what you are actually buying when you buy these coins. It is not the company's exposure. What these coins are really pricing is whether the company will notice you or not. The largest price fluctuation in this whole affair came from a post made by a CEO on Thursday evening, and Adam Aron was not friendly at that time: he called these tokens disgusting and hired a securities lawyer. Nevertheless, the token still shot up to seven times the stock price overnight. The real return is the attention from the enterprise, and whether that attention is friendly or hostile, it still pays. The short squeeze is the return marketed, and that portion cannot reach an arithmetic sum.

The truly valuable asset on this tokenized stock chain is not the Meme Coins or the token issuance platform, but the subscription and redemption channels. That is a whitelist.

1. The Weekend AMC Came Back

On Thursday, September 3, at 5:18 PM New York time, 78 minutes after the closing bell, AMC's CEO Adam Aron posted that Robinhood's tokenized AMC is "despicable, outrageous, and disgusting," and stated that he has hired external securities counsel.

Crypto Twitter saw another thing. Within six hours, two Meme Coins named after that tweet, $CINEMA and $MEME, began trading in the tokenized AMC pricing pool. The New York Stock Exchange had already closed. That theoretically should equal one share of AMC's token hit $18.04.

The real stock closed that day at $2.54. Seven times, overnight. The reference is a company whose entire investment logic is "survived the last frenzy."

When trading opened the next day, the price difference disappeared, but the process was different from what most people imagined. This stock surged to $3.11 in the first fifteen minutes of pre-market, up 22%, and then slid back down, closing at $2.65. Section 6 will dissect this segment. The most easily misread moment in the whole affair is this one hour.

This is precisely why the AMC case is useful. Everything the theory of short squeezing says should happen, happened: real Meme stock codes, a real CEO, real crowds, real decoupling, and real buy orders hitting the market. Ultimately, the stock returned to its position from a week ago.

2. Stock Tokens on Robinhood

Three things need to be introduced first, as they did not exist eighteen months ago.

Robinhood Chain is a public chain operated by Robinhood itself. The top hundred pools have a daily turnover of around $1.65 billion, of which most is ordinary crypto assets.

Stock tokens are issued by Robinhood Assets (Jersey) Limited, tracking individual US stocks. Legally, it is not a stock but a debt instrument, providing you with an economic return equivalent to a share of stock, backed by real stocks held at a brokerage custodian. In practical use, one token represents one share's exposure, and licensed intermediaries (Authorized Participants, AP) can subscribe and redeem at fair value. This operates under the same principle as ETFs.

Issuing platforms refer to sites like long.xyz, where anyone can deploy a Meme Coin and a trading pool with one click. In August, the pricing asset changed: the Meme coins were previously priced in USD but now are priced in tokenized stocks. You are not buying $BONER with USD; you are using tokenized Hims & Hers to buy it.

This change is where the whole story lies because it means buying Meme Coins is equivalent to buying stocks. Your $ETH, $USDG on the way in will be exchanged for stock tokens, causing the pool to continuously accumulate stocks, with transaction fees also being settled in stocks rather than cash. A group of Meme Coin buyers becomes, in mechanism, a buy order for a publicly listed company's stocks.

Currently, there are seven stock-priced venues that have entered the top hundred most active pools, with a total daily turnover of about $73 million. It has already become a popular play.

One figure to remember, as it explains most of the forthcoming issues: the total amount of all tokenized stocks on this chain, across fifty symbols, corresponds to approximately $138 million in real stocks. And AMC alone had about $150 million in turnover on Nasdaq just last Friday. The entire on-chain stock market does not even equate to a busy afternoon for a mid-cap stock.

3. GameStop Analogy and Where It Fails

The whole idea of short squeezing originally refers to what happened with GameStop, so let’s clarify what transpired in 2021.

GameStop's success depended on a hard constraint: the number of shares sold short was approximately 138% of the float, meaning there were more borrowed and sold shares than existed in the market. Retail investors held on tight, and the short sellers had nowhere to buy back, causing the price to surge from $17 to $483 during intraday trading on January 28. Ultimately, the brokerage restrictions on buying ended it, with Robinhood being the most famous among them, triggered by a $3 billion clearinghouse margin call. The float was static; everyone's only leverage was closing the doors.

Now, the same scene transferred to the Robinhood Chain.

When tokenized AMC surged to seven times the stock price, Robinhood's issuing agent did not close the doors. It went out and bought real AMC shares, placed them in custody, and re-issued tokens accordingly. Over three days, 3.05 million shares were created, and 310,000 shares were redeemed and destroyed, increasing the supply of tokenized stock from 152,106 shares to 2,895,758 shares. Seventy-two hours and nineteenfold.

The Hims story is the same, albeit at a slower pace. When $BONER launched on August 20, Robinhood Chain's tokenized Hims only had 468 shares, now it is 130,876 shares, expanded 280 times, corresponding to approximately $3.6 million of real Hims & Hers purchased and held. On September 3, we measured this: over four days, the proportion of $BONER in the tokenized supply dropped from 81% to 47%, while the actual number of tokens held increased. It didn't abandon the float; it was diluted around it.

However, this matter needs to be clearly stated. The subscription and redemption channels were not created to prevent short squeezes. Their existence is to ensure tokens remain pegged to stocks, which is the entire reason to hold tokenized stocks rather than Meme Coins, and follows the same mechanism as all ETFs. It does not lead to a holding outcome; it’s merely a side effect of a mechanism doing its job. Moreover, this outcome is much better than when the doors were shut in 2021 because no one was blocked from selling.

What Are People Betting on When They Buy Meme Coins

Let’s trace this chain from the retail investors' side. The first half is valid; skipping it would be dishonest.

You buy $MEME with USD. The router converts the USD into stablecoins, then into tokenized AMC, and finally into the Meme Coin. Your money on the way in is physically the buy order for the tokenized stocks. As more people buy, the token price rises above the true stock price, a premium appears, allowing AP to profit: it buys real AMC on the NYSE, hands it over to the custodian, gets new minted tokens, and then sells them at the premium price into the pool.

The core judgment from retail investors is correct. Money from the crowd has indeed landed in the New York market in the form of real buy orders. This is not a guess; it is a $7.6 million AMC during a weekend, with the most concentrated segment accounting for 7.6% of pre-market volume.

Next, the "flywheel" concept will add another layer: forced buying pushes up stock prices, rising prices validate the narrative, more people rush in to buy coins, and AP needs to buy more. This is the ideal script, but it will break in three places.

First, the volume is too small. $7.6 million faces a stock with a daily turnover of $150 million. In steady-state, AP's footprint probably accounts for a thousandth of the turnover.

The second and most critical issue: this mechanism will shut itself down. AP's goal in buying is to eliminate the premium; once the premium disappears, the reason to buy evaporates. It is shut down by its own success.

Third, it is reversible. Redemption means the subscription runs backward, and when the crowd disperses, AP will sell the same batch of stocks back to the market.

Putting these three together reveals what has changed from 2021 to now; the answer emerges. Moreover, it has nothing to do with scale.

GameStop was positive feedback: every forced short covering pushed the price a bit higher, thus forcing the next short to cover. The cycle feeds itself. That is the definition of a short squeeze.

Conversely, the subscription and redemption mechanism is designed as a negative feedback loop: arbitrageurs buy only to erase the price difference that triggered its emergence, so it both takes effect and disappears. A living float does send your money to the market, but it is a regulator, never an accelerator.

A static float turns buying pressure into a spiral, while a dynamic float turns the same buying pressure into a diminishing cost shock. Both can push stock prices, but only one can sustain it.

To put it bluntly, the sentence that deserves to be remembered the most is: A group of people can indeed push the on-chain price up quickly. What they cannot do is hold it down because as soon as the stock market opens, AP will fill the gap back. The ceiling is not determined by how large the crowd is but by how many hours the channel is still closed.

The only thing the issuer cannot print is time. See Section 7 for this.

4. Who Is Sitting at the Table

Do not treat it like a machine; first ask who is sitting at the table, what each seat earns, and the judgment becomes much easier.

One statement worth making directly: The Authorized Participant is the most stable returner at this table. It mints tokens at fair value, sells them into the premium created by the crowd, and buys them back once the crowd disperses. During that weekend with AMC, it bought and held approximately $7.6 million worth of real stock at the price it chose, facing a market willing to pay seven times fair value. There is nothing improper here. This is a role with consideration, and it is precisely this consideration that makes someone willing to undertake this task at four in the morning. The peg holds because there is money to be made in this transaction. What matters to us is only one thing: Where do sustainable returns grow? It grows here, not on the issuing platform, nor on the coin.

5. GameStop Analogy and Where It Fails

It is not about "Is this a short squeeze?" but rather: Can pricing assets be subscribed and redeemed?

Everything else follows from this decision, as it determines whether the premium is a price decoupling that can be erased or fundamentally a price of another asset.

The real Robinhood stock tokens are backed by an issuance prospectus from Jersey, have a custodian holding real stocks, every underlying has its own series and ISIN code, and there’s a whitelist of intermediaries allowing subscriptions. On the blockchain explorer, its name ends with • Robinhood Token and the exchange rate field has a value.

The fake only requires 63 lines of Solidity and about $400 in gas. Fixed supply, no issuer, no oracles, and the so-called endorsement reads as "an operational obligation of the issuer," meaning there is nothing on the chain validating it, nor can there be.

The two look identical on the blockchain explorer: quoted by the same platform, displayed in the same wallet. The entire difference lies in a field that can be empty.

So, has it ever driven real stock prices?

This section must be written carefully because only looking at closing prices makes skepticism seem too easy. By closing price, AMC was up 4.3% that day, so it looked like nothing happened. But if you calculate from the last price before the event to the highest price, including pre-market and after-hours, it is not the same.

So the honest statement is not "Meme coins couldn’t push stock prices," but rather: They pushed aggressively but never held it.

The pre-market segment on September 4 is most illustrative of how this mechanism operates, worth watching minute by minute. Compare on-chain prices with Nasdaq pre-market bids, not with the previous day’s closing: at 4:00 AM New York time, the pre-market quote for the token was $4.09, while the last real stock price was $2.54, a gap of 61%. Fifteen minutes later, propelled by 8.35 million shares traded pre-market, the stock reported $3.11, whereas the token was already on a downward trend. This convergence included about half from the stock price closing in on the token, rather than the token returning to the stock price. This is precisely what the positive feedback system predicted would result.

Then it stopped. By 9:29 AM Eastern Time, the stock had retraced to $2.62, with the token at $2.61. The buy orders that popped up at 4:00 AM had no second wave behind them because the premium they chased had already disappeared. The stock ultimately closed at $2.65.

Placing three events back in their respective histories: on that Friday, AMC traded 57.2 million shares, 1.9 times its usual volume, but only ranked fifteenth in the past six months; on July 20, AMC traded 186.8 million shares, unrelated to Meme coins. Hims’ trading volume never left a normal range. Farmmi, on September 2, traded 872.6 million shares, whereas its typical trading volume is only 45,000 shares, about nineteen thousand times.

This model contradicts intuition entirely. The most significant influence of on-chain activity on the market occurred precisely when the company was so small that the on-chain crowd was virtually its entire market, and this situation only happens when the pricing asset is fabricated, because Robinhood doesn't provide tokenization for companies with a market cap below one billion dollars. The two valid tokens correspond to companies that are too large; a purchase of $3.6 million or $7.6 million cannot sustain the price.

As for the fate of these Meme coins themselves, it has nothing to do with the foregoing: $CINEMA lit the fire under AMC and has now dropped 93%. $MEME arrived late, took on the crowd, and is currently valued at $102 million. $JINQIAN hangs on the only stock that has been truly influenced, down 98%. They are assets of attention, and the companies labeled on them are merely decorations.

6. The Real Weakness Is the Weekend, and the On-Chain Short Squeeze Might Just Happen There

Here, the true structural weakness lies not on the stock side but regarding the subscription channels operating on a 9-to-5 basis while tokens trade 24 hours a day.

This can now be seen in real-time. As I write this, any stock token from Robinhood (AMC, Hims, GameStop, Nvidia, SPY) last experienced new supply added at 23:35 UTC on Friday, September 4, which was 50 hours ago. Monday is Labor Day, and the channel will not reopen until Tuesday pre-market, creating an 80-hour window: tokens can still trade while no one can mint a single one anymore.

Read this alongside Section 3, and the earlier conclusions must be narrowed down. All prior arguments claimed that a short squeeze was impossible because the float was alive. However, during this window, the float is not alive; it is static. For a full three days, the supply of tokenized AMC is as locked as GameStop's capital was in 2021, making it impossible for any arbitrageur to unlock it regardless of how much they offer.

Therefore, the honest conclusion is narrower than "nothing can be squeezed here." Publicly listed stocks cannot be squeezed through this channel; the reasons are specified in Section 3. But tokens can indeed be squeezed, and it is only possible during the market closure window. This is not a hypothetical situation: $18.04 against $2.54 is derived this way; the +51% closing for tokenized Hims that we measured in August came from this as well. The short squeeze at the token level is a real, recurring phenomenon driven by the calendar.

There is an obvious question: why is it not happening now?

It is indeed not, and the reasons are crucial. Throughout the weekend, tokenized Hims fluctuated between -2% and +4%, now settling at +2.9%. Tokenized AMC was below fair value for most of the time, dropping as low as -7%. Together, they traded about $40 million, with the peg intact.

Still, back to that original nineteenfold. After the panic, the issuer did not retract the supply, so the float being frozen now is deep: 2,895,758 shares instead of 152,106 shares. A thin float has always been a necessary condition, while market closure merely acts as an amplifier. AP used three days of excess supply to preemptively defuse the fuse for the next three days. Quite remarkable for an unintentional event.

For holders of these tokens, the practical interpretation is: The risk factor is the calendar, not the company. Long weekends, public holidays, and a relatively unnoticed asset that hasn't been issued much recently—when these three align, the relationship between the on-chain price and real stock price is weakest.

Pressure Test: How Large Must This Operate To Be Viable

This is not a proposal; it is a yardstick to measure how far this mechanism is from “working effectively.” First, let’s clarify two terms that are the foundation of this entire argument.

Short selling balance is the quantity of shares that have been borrowed and sold short, with sellers betting that the price will fall. These shares eventually must be bought back. This is the fuel.

Days to cover is the short selling balance divided by daily average trading volume: if shorts are the only buyers in the market, how many normal trading days will it take to buy everything back? This is the fuse. A higher number indicates shorts are trapped, and normal trading volume isn’t enough for them to walk out without raising prices; a lower number means they can exit gradually through the front door.

GameStop's shorts sold more shares than existed, making it impossible for any normal trading volume to allow everyone to cover, hence the vertical price surge. The days to cover for the tokenized assets in question range between 3 to 9. Everyone can get out.

Thus, the ceiling is established: even if all these assets' shorts were to cover simultaneously, the price increase would only be 7% to 14%. None could double.

Adding two more figures. The conversion rate of the issue: $BONER peaked at about $85 million, forcing about $3.6 million of real Hims shares to be bought and held, meaning that for each $1 of Meme Coin market value, about 4 cents of forced buying was generated. The price? To escalate the price to the extent of a complete short squeeze, the channel would need to purchase nearly the entire short position.

To establish a scale: the largest Meme Coin in this chain's history is $AI, at $270 million. The lowest threshold for entry needs to be thirteen times that, resulting in around a 9% price increase.

There are no cheap small tickets to choose from. The smallest company within the tokenization by Robinhood is NuScale, at $951 million, three orders of magnitude bigger than Farmmi. This threshold is no coincidence: the existence of fake tokens is due to this, and the safety of real tokens is also because of this.

7. Under What Circumstances Would We Change Our Judgment

If Robinhood lowers the market cap threshold, or allows genuinely small companies to issue series. The entire margin of safety lies in the fact that none of the assets that can be squeezed have been tokenized.

If a second Authorized Participant emerges, or the current one speeds up. Today’s premium cap depends on how long the channel stays closed. A 24/7 subscription channel would erase the last piece of genuine decoupling, while slower or narrower channels would amplify it.

If US stocks moved to 24-hour trading, it would directly eliminate non-trading hour price differences.

A lesser-known target coinciding with a long weekend. The vulnerability in Section 7 is currently dormant because supplies have increased, not because someone fixed it. If a freshly launched or infrequently issued token collides with a public holiday market closure, that 2021 property would again return.

Fabricated pricing assets would transition from exceptions to norms. Two cloned contracts within a week have aligned the capital tables at five significant digits, and an imitation code has already infiltrated the most active pools on the entire chain. This portion’s diffusion requires no one’s approval.

8. What We Take Away From This

The throat of tokenized stocks is the subscription and redemption channels, not the trading venues. Downstream items—issuing platforms, Meme Coins, liquidity pools—are all replaceable and will ultimately boil down to a place without profits. The irreplaceable seat is held by one who simultaneously holds the issuance license, custody relationship, and AP whitelist. If we are to gain exposure to tokenized stocks, it is here.

The discipline of the premium comes from a healthy primary market; that’s the old lesson of ETF, which has been reiterated on-chain within a week. The median premium for tokenized Hims is less than 1%, as there are those who can produce more at any time. The fabricated FAMI token does not have this base, so its premium has not converged, instead dropping straight through parity to a 10% discount and continues to decline. The same shaped curves, opposite mechanisms, completely different risks.

Fabricated pricing assets represent the next regulatory flashpoint and are the true investor protection issue here. A token imitating the entire equity of a company, backed by nothing and not stating the issuer while sold alongside genuine securities to retail investors, is not a marginal case; it has already occurred twice and is spreading. At $400, one can create one, indistinguishable from the genuine one in any consumer-grade interface. This matter is worthy of inquiries for Molly, to see if we should address it further.

This alters what these coins fundamentally represent. It is not leverage exposure to a publicly traded company. During trading hours, the asset can only account for 1% of this coin's volatility, leaving virtually no company influence. It is closer to a bet on corporate attention: whether the CEO will notice, whether the company will respond, and whether this code will be involved in a story so large that the headquarters must respond. This bet has won. Aron’s post is the starting point for the largest price fluctuation in this article, and the CEO of Hims & Hers also followed $BONER’s account. Neither is endorsing anyone during that affair, but attention still cost money.

The short squeeze is a separate leg. It is the one sold away and the one that does not hold up. Buyers of these coins should at least be clear about which piece they are genuinely long on.

Finally, it’s the framework worth remembering. A short squeeze is not "a lot of increase," but rather "a self-feeding increase." Tokenization makes the float active, hence the spiral that should form is converted into a shock cost that diminishes, real, measurable, and concluding before noon. What makes tokenized stocks solid infrastructure is precisely that characteristic that prevents squeezing. This is a good outcome for Robinhood and an expensive lesson for everyone who bought into that narrative while reminding us: what we should focus on is the issuance layer, not the trading layer built upon it.

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