So the dividend isn’t paid in Crypto, they’re just using a blockchain ledger. while that makes sense I don’t see how it’s functionally different from any other dividend
For clarity on the Crypto Dividend situation, this article explains what Overstock did quite nicely:
Overstock, the Nasdaq-listed online retailer and technology company, made history last spring by offering a digital dividend, also known as an ’ airdrop’ in blockchain parlance, to its 40 mn shareholders. One digital share of the OSTKO blockchain-based security token was offered for every 10 shares owned of Overstock.
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I’m liking the direction in the conversation.
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Presumable there was some short interest in Overstock at the time, what happened to overstock shorts? were they forced to buy?
It appears so. Some articles on the incident and relevant quotes:
“to thwart Overstock’s short sellers, with whom he has been tangling for decades. The plan worked — for a time anyway — and sent Overstock shares surging 60% over the last two weeks, to a 52-week high of $29.75 in midday trading Friday.”
That’s because short sellers — who place complex trades that are effectively bets that a stock will drop — were concerned about getting stuck with the stock’s blockchain-based dividends, sources said. To protect themselves, they began to unwind their short positions ahead of the dividend hitting, which drove the stock higher.
“Byrne figured out how to stick it to Wall Street,” a source said. “He designed the dividend to create short covering.”
- On Tuesday, U.S. District Judge Dale A. Kimball tossed the federal class action first filed last September by short sellers who claimed they’d been hosed by Byrne.
edit:
The SEC appeared to eventually step in, however. On Wednesday, Overstock announced a big change: that investors would not have to hold the dividend for 6 months, as was initially required, but could immediately begin trading the instrument. Overstock also postponed the record date for the dividend, and said it will announce a new distribution date, while suggesting that questions from unnamed “regulators” helped lead to the decision.
However, since then, precedent has been set, so the SEC likely couldn’t step in again.
So from a purely academic standpoint, it does seem like it would have the effect of forcing shorts to cover.
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Yeah, I just found those articles. Interesting. That would make it difficult to short any stock at any level if they issued these dividends.
Not sure if that’s actually a good thing 
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Given some of the recent rules being tabled at the DTCC I would imagine the kind of shorting we have seen with GME and Overstock is likely to become much harder to execute. I would be very surprised if anything like this is allowed to happen again.
But yes, it adds some big questions about how shorting would work on a stock that regularly issues crypto dividends. Potentially new regulations will need to be added, as I can see this being a popular choice moving forward.
On a side note GME is currently up +29.77 as of writing. A welcome, if perhaps temporary change.
It won’t be allowed to happen again, that’s what the rules are for;)
Good job on jinxing it!
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Also not sure crypto dividends would have much effect on those who are short via options. as dividends are usually just reflected in a change in the price of the option.
And as short interest in GME is currently reported at 18% and supposedly most shorts are using options to disguise their positions I don’t know if it would actually work.
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Sort of an aside - the fine for misreporting short interest is low enough to be a cost of doing business. Last year Barclays was fined a $125k for misreporting. Citadel (who I’m sure we’re all familiar with by now) was very recently fined $275k.
Additionally, S3 Data, from whom much of the reported short interest data was derived recently changed their method for calculating short interest (relevant reddit post) which effectively reduces reported short interest. Very recently the Managing Director of S3 noted on twitter that they are including synthetics in their calculations, which is concerning since nobody really knows how many synthetic longs have been created at this point.
There’s also a growing body of evidence that suggests Citadel owns S3 partners through the result of a series of mergers and acquisitions. Interestingly, in 2012, the founders of S3 were charged by the FBI in a $21 million real estate fraud scheme.
As you mentioned, it’s also possible that funds with large short positions are hiding their true short positions using options manipulation (links for everyone else). Recently the OBV levels suggested the true current price of GME is be between $800-$1000. This may be supported by evidence that funds are purchasing via dark pools (eg. FADF), which do not effect the price, and selling via the exchanges, which do effect the price, effectively driving the price down artificially. I am not sure what the reason for this would be if all the shorted positions had genuinely been covered.
There are also people crunching the numbers and finding short interest could be a minimum of 250% up to 900%.
Personally I wouldn’t feel comfortable trying to estimate the current short percentage. Everything is speculation from both sides of the argument. However, I think we can all agree there’s an unusually high amount of smoke and media coverage around a stock that supposedly has been short-covered.
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Excellent post!! With posts like that I don’t need to do my own research 
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Long term view. Gamestop will make an NFT exchange so people who now OWN digital games / software are able to trade them and Gamestop take a cut. Like steam marketplace but digital OWNERSHIP. And the beauty is you’re not locked into using it if you have the contacts/relationships to trade with.
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I hope so…
DFV is now all in 200000 shares. People are wondering why the market is going mental. This squeeze is the reason imo.
edit: and the rise of crypto, which is like a wildcard LOL
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I would also hazard a guess that now lockdown is ending there will be quite a few retail customers who are thinking of cashing in and actually spending there gains across the investment world. When you can’t spend money it is easy to invest but now the pubs are open 
Mix that in with the coinbase launch and general crypto then you have a very odd recipe
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Paperhands shaken out long time ago. No volume at all.
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If ‘external factors’ prevent them from doing the deal, most likely no other brokers will be able to do it either
Freetrade were one of the most transparent about what was going on last time this blew up.
@Gemhappe I have asked if the ‘sell button’ would be restricted in the future and received a different response comparing to the screenshot above. Mine was more detailed and in line with business messages.
Are you using now a pre-made response to help everyone with the same enquiry?
Also, please take note of the limit sell of £25000. Me and many other users would feel confident and safe with you if you all can give us an update. I did invest in GME for the fundamentals, but if a squeeze does indeed happen, I would feel left out and upset for the missed opportunity.
One last thing, if the stock reaches an all time high price - will that affect your service?
Do we need to be concerned for FreeTrade?
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