MOB Short Squeeze Has Traders Reminiscing GME Days

MobileCoin (MOB) is up more than five times in the last 48 hours after a trader was borrowing what was at one point $120k worth of the token per hour to short it, according to crypto influencer who goes by Donny Crypto on Twitter.

$MOB is set up for a short squeeze that will make GameStop look like child’s play. One party is paying 120,000 USD per hour to hold their position. It’s paying 3000% interest (not a typo). Buy MOB only on FTX. https://t.co/uwd9sXjuNX

— $MOB boss donny (@DonnyCrypto) March 27, 2021

MOB is the MobileCoin project’s token and is intended for use as a currency for private mobile payments. The project is aimed to integrate with messaging apps and allow users to privately transact without providing information to a third party wallet.

The move has left traders guessing as to why someone would build a $150M short position against this token. Going short means borrowing an asset in order to sell it at market price, with the plan of buying and returning the asset at a lower price, pocketing the difference.

“It’s likely part of a larger strategy that makes the overall portfolio less sensitive to movements in the market, or delta neutral,” Donny Crypto told The Defiant.

Delta neutral is a portfolio strategy which typically involves both options and their underlying securities, making changes in the security’s price net out to zero. This allows a trader to make money only on the volatility of a given asset, which may be an advantage to some.

Still, other traders simply jumped along for the ride, with some speculating a short squeeze -when short sellers are forced to buy more of the token to cover their positions- could be coming.