David Sacks writes:
First, the digital distribution platform Discord banned the WallStreetBets account after the close Wednesday for “hate speech, glorifying violence, and spreading misinformation.” (For a moment, it looked like Reddit had also banned the group, but they resisted pressure to do so.) If the quoted justification sounds familiar, it’s nearly identical to the one given by Google, Apple, and Amazon for deplatforming Parler just three weeks earlier. Echoing Amazon, Discord said it had sent the group repeated warnings about objectionable content before deciding, on that day of all days, to shut them down.
Meanwhile, WallStreetBets investors were locked out of their trading accounts by online brokers such as Robinhood on Thursday morning. Based on new collateral requirements that it says were imposed by an industry consortium, Robinhood forbade its users from buying GameStop and other stocks that WallStreetBets had identified as short squeeze opportunities. Users were allowed only to “close their positions”—in other words, to sell to the shorts desperate to buy. When angry users registered their disapproval by leaving over 100,000 one-star reviews of the Robinhood app in the Google Play Store, Google deleted them.
Normal trading was allowed to resume Friday, but the hedge funds used their 24-hour sole ownership of the battlefield to fortify their positions, covering the most vulnerable shorts. Wall Street then sent in reinforcements, as new short positions were taken at these high price levels, virtually guaranteed to pay out when, inevitably, the air leaks out of the balloon. Faced with a game that, for once, they couldn’t rig in their favor, it appeared that the insiders tipped the board over and started a new game. As a massively decentralized online group of scrappy outsiders, the only tools at WallStreetBets’ disposal were online trading and social networking. Both were frozen at the crucial moment, and the hedge fund insiders were let off the hook. The weaponization of censorship is a big part of the reason why.
Down the Slippery Slope
Some of us warned of a slippery slope when Parler was taken down and a sitting president was systematically ghosted from every online speech platform. But we could not have foreseen how slippery the slope would be, or how fast we would slide down it. We were told that the curbs on speech of President Trump and his supporters were necessary to prevent further “insurrection” and protect the peaceful transition of power. However, much like the troops and barricades that still ring the Capitol, these speech restrictions remain in place well after the transition of power has occurred. The censorship power is always justified in response to a genuine outrage or crisis, but it is rarely relinquished once the threat passes. Rather it gets weaponized to protect powerful, connected insiders, as the GameStop fiasco illustrates.
How do we suppose Discord chose that moment to enforce its “Community Guidelines” against WallStreetBets? Almost certainly, one of the hedge funds whose ox was being gored combed through their message boards looking for anything that might violate the terms of service. And surely they found it, as these boards contain the same raunchy language you would hear if you visited any trading floor or boiler room on Wall Street. They presumably reported the content to Discord, which took the group down.
