$150 Million Emotional Surge: AMC's Short Squeeze Cycle Returns After 5 Years

On Thursday, AMC Entertainment closed at $2.54. The largest cinema chain in the U.S. has a market capitalization of $2.27 billion, with 893 million shares outstanding, and there was no news on that day.

Half an hour after the market closed, a new trading pair appeared on Robinhood: AMC/MEME. The new coin is called "A Meme Coin," and its abbreviation happens to be AMC: MEME.

Then things started to spiral out of control.

In just five hours, the MEME coin surged by over a thousand times, starting from a market cap of about $3 million, breaking through $30 million and $50 million, and approaching $150 million; at the same time, AMC's own quotes also moved, with overnight bids rising over 14%, and then expanding to 18% to 20% in pre-market trading.

The surge led to AMC's CEO and Robinhood's founder arguing on X late at night.

To understand what happened, we need to revisit the history between AMC and Robinhood.

Saved by the Same Brokerage, Also Closed by the Same Brokerage

In 2021, there was a short squeeze between AMC and Robinhood that was significant enough to be written into textbooks.

On January 28 that year, Robinhood restricted buying on a batch of skyrocketing stocks, allowing only selling. The list included GameStop and AMC, and retail investors watched the prices plummet in the app, calling the action a betrayal. But retail investors couldn't do without it: Robinhood was the most convenient entry point for retail investors at the time, and most of AMC's retail orders came from there. By June of that year, AMC's stock price was pushed above $72, becoming one of the most discussed stocks in the U.S. Aron cleverly capitalized on this enthusiasm: he sent free popcorn to shareholders registered in Investor Connect, befriended retail investors on social media, and conducted rounds of stock issuance at high prices to pay off debts and keep the nearly bankrupt company from the brink.

At that time, Aron was one of the most beloved CEOs among retail investors.

Five years later, the same company and the same CEO turned their attention to a new business of the same brokerage: tokenized stocks on the blockchain. The name AMC remained unchanged, as did Robinhood, but the battlefield of that short squeeze shifted from New York's order books to a 24/7 blockchain pool. What ignited the market this time was still the formula validated in 2021: attention, leverage, and the short squeeze story.

A Thousand Times in a Day

The Robinhood chain is a layer-two network that only launched in July 2026, marketed as "tokenized U.S. stocks": copying New York stocks onto the blockchain for 24/7 trading, accessible even to non-U.S. users. The copied assets have their own rules; they follow stock prices and claim to correspond to the underlying stocks held in custody, but they do not grant voting rights or allow for the exchange of real stocks in New York accounts.

The gameplay of meme coins quickly changed shape. In the past, creating a meme involved putting ETH or USDT into the pool; now, creators can put NVDA, TSLA, AAPL, or a movie stock called AMC into the pool. The front-end path is well hidden: you see that you are spending stablecoins, but the back-end has already swapped for you through two steps, first into stock tokens, then into the pool to exchange for memes. Even the project's cut is settled in stock tokens.

Thus, the dollar price of memes is compressed into a formula:

1 meme can be exchanged for how many stock tokens, multiplied by the dollar price of the stock tokens.

A double bet. Betting that memes will outperform that stock while also betting your fortune on the stock's rise and fall. If the stock rises, the dollar price of the meme is pushed up; if the stock falls, even if the meme outperforms, the dollar returns will shrink. AMC happens to be the asset with its own narrative and memory: in 2021, it was shorted by bears, saved by retail investors, and had its trading halted by Robinhood. The five letters behind it represent the emotions of an entire generation of retail investors.

This gameplay has been ongoing on the Robinhood chain for a month.

For example, BONER, launched on August 20, directly linked to the tokenized shadow of Hims & Hers. This company sells men's health products, and the narrative of BONER is straightforward enough not to need translation: "hard currency," shorting HIMS. It hit a weekend: New York was closed, and the issuer could hardly increase supply, draining the freely circulating pool, causing the on-chain HIMS to surge from $28.84 at Friday's close to $132.64, more than four times; on Monday, the issuer minted 4,000 new coins to revert the shadow, but BONER continued to rise, driven by emotions.

Next came FATCOIN, linked to the tokenized stock of Eli Lilly (LLY), telling a joke about a weight-loss drug that "gets fatter the more you hype it," which rose 175 times in ten hours.

Other companies' executives didn't say much, but AMC's CEO couldn't sit still.

After the CEO's outburst, the market surged even faster.

What triggered the CEO's anger was that the activity on the blockchain had reached the quotes of his own stock, with a pool he couldn't control trading using his company's name and price.

His first statement was very firm: Robinhood claimed to cover tokenized stocks of over 190 companies, including AMC; this project has nothing to do with AMC, is unauthorized, and has not been registered under U.S. securities laws, escalating to terms like "shameful, absurd, disgusting, and unforgivable," and stated that the board would immediately hire external securities lawyers.

Tenev replied, "What does it have to do with me?" and the market instantly entered a second phase.

Aron quickly fired back: he stated that Robinhood issued products "representing AMC stock" through an overseas entity in Jersey, which is not subject to U.S. securities laws, raising "existential concerns" for the company; AMC spends millions of dollars annually on securities compliance, while Robinhood's "synthetic stock market" has separated trading from the financing and ownership of listed companies, where traditional shareholders have voting rights, and token holders have nothing. He demanded that Robinhood voluntarily stop trading AMC stock tokens, or else lawyers would take action to force a halt and submit inquiries to the SEC.

At this point, the situation had spread from the pool to Washington.

The argument itself became part of the market. With each round of insults, the discussion level rose; the higher the discussion level, the thicker the buying pressure in the pool; the thicker the buying pressure, the higher the meme rises, and the higher the meme rises, the more restless the CEO becomes. This is a closed loop, fueled by attention itself. The worst thing for memes is that no one is talking about them.

Still Far from a Short Squeeze

Putting emotions aside, what really matters is the scale.

The total issuance of tokenized AMC is about 1.33 million. 1.1 million coins against 893 million shares of stock is 0.15%. About 746,000 coins are locked in various pools, with the MEME/AMC main pool alone locking up 557,000 coins, close to half of the total issuance; around 700,000 coins remain in wallets and stablecoin pools for price discovery.

Data on the underlying stock is also present: short positions hold 42.4 million shares, accounting for 4.78% of the float; the average daily trading volume is about 40.25 million shares, equivalent to about $100 to $120 million.

0.15% of the stock, even if fully bought, is just a fraction of the daily trading volume of the underlying stock. To trigger a real short squeeze, a sufficiently large buying pressure on the underlying stock is needed to pry loose those 42.4 million shorted shares. The reason AMC could rise to $72 in 2021 was that retail investors were buying real stocks in New York, with volumes measured in hundreds of millions of shares. Today's blockchain pool is still several zeros away from that scale.

Calculating a $6 Price

Someone has already started calculating for AMC.

The calculation goes like this: when the market cap of MEME reaches $150 million, one MEME is about $0.15; in the MEME/AMC main pool, it takes over 30 MEME to exchange for one tokenized AMC. The implied value of the tokenized AMC in the pool should be around $6, while the underlying stock is currently only $3. According to this calculation, AMC's underlying stock price needs to double to match this blockchain frenzy.

But the problem is that the price ratio is not fixed; it is determined in real-time by the buying and selling in the pool. The more people buy MEME, the fewer AMC tokens can be exchanged. The number of tokenized stocks is also not fixed; the issuer can mint more at any time, as evidenced by the 4,000 new coins minted by BONER on Monday.

However, as one of the few innovative plays in the crypto space this year, we hope that the pricing power can be in our hands, using tokenization to price a decades-old film industry, and if successful, how incredible that would be.