The Short Squeeze Logic of Meme Stocks Moves from NYSE to the Robinhood Chain

On Sunday night, on the Robinhood chain, the HIMS token was priced at $132.64.

The underlying stock, Hims & Hers, an internet healthcare company selling men's health products, closed at $28.84 on Friday. The shadow on the chain was more than four times more expensive than the underlying asset.

Pushing the shadow to this point was another coin called BONER, a name so straightforward it doesn’t need translation: the company’s main business is men's health, and the narrative of the coin is "hard currency" and "squeezing HIMS shorts."

In the 24 hours leading up to Monday, BONER surged about 1000%, with a market cap reaching around $40 million. When the market opened on Monday, newly minted tokens flattened the premium, bringing the shadow back in line with the underlying stock. But BONER continued to rise.

The meme stock phenomenon in the U.S. has evolved in 2026, moving the short squeeze business from the NYSE to the chain. The formula remains the same as in 2021: attention, leverage, and a story of "squeezing shorts." This time, however, the battlefield has shifted to a small pool that can't issue new tokens over the weekend.

The Night of $483

On January 28, 2021, GME hit $483 during trading.

A month earlier, it was languishing at $18. GameStop, a brick-and-mortar store selling video games, became a nightmare for Wall Street after being bought up by a Reddit group called r/wallstreetbets. Shorts, who borrowed shares to sell, betting on a decline and planning to buy back at a lower price, had borrowed more than 100% of the float. They were waiting for the company to go bankrupt, only to be bled dry by retail investors buying in with real money.

The leader of this movement was Keith Gill, known online as Roaring Kitty. He showcased his holdings online: starting with $53,000, by the end of January, his account had ballooned to $48 million. He looked into the camera and said, "I like the stock." This phrase later became the focal point of the entire event.

That year, many people heard the term "short squeeze" for the first time through Robinhood's notifications.

Robinhood was at the center of the storm. With zero commissions, fractional shares, and the ability to place orders with a tap on a mobile phone, it was the most convenient entry point for retail investors. But on the other end of that entry was a valve. On January 28, Robinhood restricted buying of stocks like GME, allowing only sales. Retail investors watched the price plummet in the app, calling it a "traitor."

On February 18, there was a hearing. CEO Vlad Tenev stated that the buying restrictions were to meet margin requirements from clearinghouses and were unavoidable. The retail investors heard a different version: you’re not letting us buy because you want the shorts to escape. AOC's questioning was the harshest, asking why institutions could still trade while retail investors were cut off. During the same hearing, Keith Gill's video filter malfunctioned, displaying a cat face. He said, "I’m not a cat, and I’m not a hedge fund." The room erupted in laughter. After the laughter, no one thought it was a joke.

Within days, GME plummeted from $483 to $90. Most of those who rushed in at the end ended up providing liquidity.

In July of that year, Robinhood went public at an offering price of $38. The prospectus showed that its funding accounts had increased from $12.5 million to $22.5 million; that short squeeze had become its own advertisement. Robinhood thus bore a birthmark: it was both the entry point for retail investors and the hand that cut them off. Five years later, this birthmark bloomed on the chain.

Underlying Stocks, Shadows, and Chips

In July 2026, Robinhood launched its own chain, a Layer 2 network based on Arbitrum Orbit (simply put, a new chain built on Ethereum), focusing on tokenizing U.S. stocks: packaging U.S. stocks as on-chain tokens for 24/7 trading aimed at non-U.S. users.

From then on, U.S. meme stocks were divided into two layers. One layer involved buying underlying stocks in the app, like GME and WEN; the other layer was the "coin-stock pairing" on the chain, where liquidity pools no longer held ETH or USDT but tokenized NVDA, TSLA, AAPL, and GME.

There are three layers here, which many people confuse into one:

Underlying Stock: Real stocks on the NYSE. Shareholder rights apply, can be shorted, and can borrow shares. Shorts borrow from this layer.

Stock Tokens: Shadows of the underlying stocks on the chain. Usually have custodial shares corresponding, but do not equal equity, have no voting rights, and minting and redemption must go through the issuer, often with only a few thousand tokens in circulation.

U.S. Meme Stocks: Independently issued tokens that use stock tokens as trading pairs. They are not collateralized and do not have a 1:1 exchange.

Buying BONER ≠ Buying HIMS tokens ≠ Buying HIMS underlying stock. The stock tokens in the pool belong to the liquidity pool, not to you.

The mechanics work like this: at the front end, you still trade using ETH; at the back end, ETH is first exchanged for stock tokens, then enters the pool to exchange for memes. The creator's fees are also settled using stock tokens. The price formula is just one line:

Meme's USD price = (How many stock tokens 1 meme can be exchanged for) × (USD price of stock tokens)

This is a double bet: betting that the meme will outperform the underlying stock while also being exposed to the stock's price fluctuations. If NVDA rises, the meme relative to NVDA also rises, compounding USD gains; if the stock falls, even if the meme outperforms, USD gains will be discounted.

At its core, it’s still the same formula from 2021: Price is determined by "who is buying, how urgently they are buying, and how painful it is for the shorts," not by profits. Attention is the fuel, leverage is the accelerator, and the short squeeze story is the navigation.

In August, these three elements converged on a coin called BONER.

A Coin Called BONER

On August 20, BONER was launched on the LONG platform of the Robinhood chain. The main pool was BONER/HIMS, and the quoted asset was not a stablecoin but the on-chain shadow of HIMS.

The community page displayed a set of data: approximately 62 million shares of HIMS were shorted, accounting for about one-third of the float.

The real engine is a quieter mechanism.

The path to buy BONER: stablecoin or ETH → first exchange for HIMS tokens → throw HIMS into the BONER/HIMS pool to get BONER. The liquidity pool is a place where assets are locked in and trades are automatically matched according to the formula. Once HIMS enters the pool, it is locked inside and cannot come out.

About ten days after launch, the total issuance of HIMS on-chain was approximately 58,714 tokens, of which 31,198 tokens, about 53%, were locked in the BONER/HIMS main pool. Another 1,424 tokens were scattered in other meme pools. Only about 20,303 tokens were left for HIMS/stablecoin and HIMS/ETH to discover prices.

How large is the total on-chain HIMS market? Based on the underlying stock price of $29, the total market cap of all on-chain shares is about $1.7 million, calculated by multiplying total supply by the stock price, excluding any inflation. After half was consumed by a meme pool, the freely tradable portion available to anchor the stock price is as thin as paper.

Then came the weekend.

The NYSE was closed. The issuer had to buy the underlying stock before minting new tokens, and no new tokens could be issued over the weekend. The remaining liquidity in the HIMS/USDG pool was very shallow, and small orders could send the quotes soaring. On Sunday night, the on-chain HIMS briefly hit $132.64, while the underlying stock closed at only $28.84 on Friday, a premium of more than four times. No one could explain which small order triggered that large bullish candle.

BONER's USD price = (BONER's ratio to HIMS) × (on-chain HIMS's USD price). When the quoted asset was squeezed up, BONER's USD price skyrocketed: it surged about 1000% in 24 hours, with a market cap reaching between $35 million and $41 million, with trading volumes from a few million to twenty million dollars.

So a more accurate statement would be: Freely circulating on-chain HIMS was drained by the pool + no new coins could be minted over the weekend = on-chain shadow was squeezed out of weekend premium → the paired meme's USD market value was amplified by this premium.

When the market opened on Monday, the issuer quickly minted about 4,000 HIMS tokens to flood the premium. The on-chain HIMS returned to around $29 within hours, re-aligning with the underlying stock. The premium leg died quickly.

In theory, if the ratio remained unchanged, BONER's USD price should have dropped significantly. But it continued to rise. The Defiant's data during Monday's trading showed this structure: when the HIMS token returned to the vicinity of the underlying stock, BONER was still priced around $0.04, with a 24-hour increase of over a thousand, and a market cap of around $40 million.

But BONER continued to rise, and the sentiment was building.

At this point, it is essential to clarify the distinction from "squeezing HIMS underlying stock." There are only over 50,000 tokens on-chain, while the underlying stock float is about 192 million shares. What is locked is a small pool of Robinhood-wrapped tokens, not the NYSE float. The 62 million shares of short positions will not be automatically closed by a meme pool. On the Ondo side, similar HIMS-wrapped tokens are an order of magnitude larger, closely tracking the underlying stock without such weekend decoupling.

It is a case of ultra-thin tokenized stocks being squeezed on-chain after being drained of floating supply by a meme pool when new issuance was not possible over the weekend, layered with the narrative of "ED Company + BONER + shorts." The advertisement targets the NYSE, but the engine runs on that small token pool on the Robinhood chain.

What Data Should We Watch When Trading U.S. Meme Stocks

U.S. meme stocks are divided into two layers, focusing on different metrics.

For the underlying stock meme in the app, watch five numbers daily: mention volume, short interest/borrowed shares, trading volume multiples, whether there are new issuances, and near-month options.

For the coin-stock pairing on the chain, watch another five numbers daily: premium, changes in total token supply, main pool lockup, meme/stock ratio, and main pool buy/sell ratio.

Premium = On-chain stock tokens / underlying stock − 1. A large premium means you are betting on a thin weekend; a premium close to 0 means you can only bet on the meme's own ratio.

Packaging Pool: Total supply of stock tokens, how much is locked in the main pool, and how much is left for price discovery in the pool. If total supply is only a few thousand tokens and over half is locked in the main pool, it can create a squeeze like BONER; if supply is large and lockup is dispersed, it cannot be replicated.

Minting: Has total supply increased today, and has there been large mints after market opening? If someone is minting, the second leg (shadow premium) is likely being dismantled. If priced at weekend highs, it will treat the bubble as chips.

Ratio: 1 meme = how many stock tokens. After market opening, this is the only metric that matters. If the ratio rises = sentiment leg; if the ratio falls and USD price remains flat = it’s likely the shadow is propping up the balance sheet.

Pool Health: Main pool depth, buy/sell volume, and whether large sell orders will push stock tokens back into free circulation. When selling pressure comes, both the meme and the shadow will shake together.