Debunking the Viral Michael Jordan GameStop Rumor: The Truth Behind the $500 Million Myth.
A bizarre and viral story about Michael Jordan resurfaces on the internet every so often, sparking concern and confusion among fans. If you've ever received an email or direct message from someone claiming that Michael Jordan "lost $500 million" on GameStop, you're not alone. It's a story that seems to pop up every time there's a lull in the news cycle. The claim goes something like this: Michael Jordan lost an astronomical sum betting against GameStop’s stock during the infamous meme stock craze in early 2021. The rumor continues, alleging that this loss led him to sell his beloved Charlotte Hornets basketball team to a hedge fund that held his debt.
Many versions of the story are circulating. Some claim that Michael was in so much debt that he had to sell the Hornets to a hedge fund, while others suggest that he lost $500 million simply from a bad short position on GameStop stock. Some even believe that Jordan’s team was sold at a $3 billion price tag just a few years later because it was the only way he could settle his financial woes. But what’s the truth behind this viral myth?
A simple search on YouTube or TikTok will yield countless videos claiming Michael Jordan's financial misfortune, all of them alleging that he was forced to part ways with the Charlotte Hornets because of a disastrous GameStop investment. But as it turns out, these claims are far from the truth. Here’s a closer look at the real story behind the rumor, the connection to Melvin Capital, and why Michael Jordan’s supposed $500 million loss is nothing but fiction.
The Meme Stock Mania and the GameStop Short Squeeze
To understand the rumor, we first need to rewind to January 2021, when GameStop stock became the center of a stock market revolution. The stock, once considered a dying brick-and-mortar video game retailer, became the focal point of a "short squeeze" orchestrated by a group of amateur investors on Reddit’s Wall Street Bets subreddit. These investors targeted institutional hedge funds that had taken massive short positions against GameStop. One of the biggest victims of this short squeeze was Melvin Capital, a hedge fund that had bet against GameStop.
By January 31, 2021, GameStop's stock price had soared by over 1,600%, causing Melvin Capital to lose more than 50% of its value in a matter of days. To save the firm, Melvin received a $2 billion cash infusion from other hedge funds. Despite the dramatic loss, Melvin's founder, Gabe Plotkin, was not brought to ruin. The hedge fund eventually closed in 2022, but it wasn’t the catastrophic collapse that many Reddit traders had hoped for. Instead, Melvin Capital remained a player in the world of hedge funds, albeit a humbled one.
The Alleged Connection Between Michael Jordan and GameStop
So, where does Michael Jordan fit into this story? According to the viral rumor, Michael Jordan was supposedly deeply involved in the GameStop short squeeze and suffered enormous financial losses as a result. The theory claims that Jordan, allegedly shorting GameStop through Melvin Capital, lost $500 million. This loss supposedly left him in debt, leading to his sale of the Charlotte Hornets (formerly the Charlotte Bobcats) to a hedge fund to settle his financial obligations.
The key figure in this rumor is Gabe Plotkin, the founder of Melvin Capital. Plotkin had purchased a minority stake in the Bobcats in 2019, which has led many to believe that Jordan was financially tied to Melvin Capital. According to the viral claim, since Plotkin was involved with both Melvin Capital and the Bobcats, it must follow that Jordan had an investment with Melvin Capital and was likely caught up in the GameStop debacle.
This narrative, however, is entirely based on speculation with no real evidence. To see why, let's look at the timeline and facts more closely.
Michael Jordan’s Ownership of the Charlotte Hornets
Michael Jordan has had a long and successful career in the NBA, but his involvement with the Charlotte Hornets, which began in 2006, is where the rumor begins to unravel. Jordan first invested in the team that would become the Charlotte Bobcats, and by 2010, he had purchased a majority stake in the franchise. By 2014, Jordan increased his ownership to 90%. His total investment in the team was approximately $300 million.
In 2019, Jordan sold a minority stake in the team at a valuation of $1.5 billion. Among the buyers was none other than Gabe Plotkin. This small connection is at the heart of the viral claim. People began to assume that Jordan’s involvement with Plotkin’s Melvin Capital meant that he was exposed to the firm’s investments and the short bet against GameStop.
In June 2023, Jordan sold a majority stake in the team to another group at a valuation of $3 billion. This was seen as a strategic business move—not as a desperate fire sale to cover debts. Contrary to the rumor, Jordan didn’t sell the Hornets under duress. Instead, he made a lucrative decision that significantly boosted his financial standing.
Why Michael Jordan Didn't Lose $500 Million
Now, let's address the elephant in the room. Did Michael Jordan lose $500 million betting on GameStop? No, he did not.
There’s absolutely no evidence to suggest that Jordan was ever involved in shorting GameStop or that he had a significant investment in Melvin Capital. The origin of the rumor can be traced back to a Twitter account that first mentioned the supposed $500 million loss in October 2021. The claim was based on the adjustment of Michael Jordan’s net worth between 2020 and 2021. In April 2020, Forbes estimated Jordan’s net worth at $2.1 billion. By April 2021, this estimate had dropped to $1.6 billion. Some people mistakenly assumed that the $500 million difference was the result of losses from the GameStop short squeeze.
However, the reality is far more mundane. Forbes and Finance Monthly have consistently reported Jordan’s net worth at around $3.6 billion today. It’s likely that the discrepancy in Jordan’s net worth estimates simply reflected changes in the broader financial landscape, investments, and asset valuations, rather than a huge loss in GameStop.
Furthermore, the idea that Michael Jordan would have been heavily invested in a single short bet—let alone one against GameStop—is laughable. For Jordan to have lost $500 million, he would have needed to have invested at least $1 billion into Melvin Capital’s GameStop short position. There’s no indication that this was the case.
Debunking the Rumor: The Real Story
The claim that Michael Jordan had to sell the Charlotte Hornets to Gabe Plotkin’s Melvin Capital to cover his debts is nothing more than a viral hoax. The facts show that Jordan's decision to sell a majority stake in the team was a business move, not an act of financial desperation. As for the GameStop connection, there is no evidence that Jordan ever shorted GameStop or was involved in Melvin Capital’s downfall.
The myth that Michael Jordan “lost $500 million” during the GameStop short squeeze can be traced back to baseless speculation and misinformation. To summarize:
- Did Michael Jordan lose $500 million on GameStop? No.
- Was Michael Jordan forced to sell the Hornets to cover debts? No.
- Did Michael Jordan profit from the sale of the Hornets? Yes, absolutely.
Michael Jordan remains a multi-billionaire. The sale of the Hornets only made him wealthier. In fact, this entire viral story is just that—a viral, baseless rumor fueled by a misunderstanding of financial details and a thirst for sensationalism.
To conclude, Michael Jordan’s financial situation remains solid, and there’s no reason to believe that his involvement in GameStop or any financial trouble led to him selling the Hornets. The truth is simple: Michael Jordan is still one of the wealthiest individuals in sports—and he never had any financial crisis stemming from GameStop.
