I really like this take. The whole time (pandemic onward) I've been thinking: "how can a bunch of small potatoes on WSB actually make such an impact." This neatly explains it... It's the HFT amplifying these actions.
- Citadel is paying multiple billions to get in on a firm that's so talented that they managed to take on this GME position, or
- Citadel is a market maker that has written a shitload of near-naked call options and now needs to deliver on them?
HFT is not the root of all evil. Citadel isn't making a killing off of frontrunning retail investors that have a Robinhood account containing $137. Odds are pretty damn good that they're in hot water with an options position and need to ensure that Melvin stays afloat to try and keep as many contract OTM as they can.