GameStop is considering investing in alternative assets, including crypto and especially Bitcoin.
Video game retailer GameStop appears to be considering investing in Bitcoin and cryptocurrencies in general. Although it is just a rumor, this information was enough to "inflate" the company's stock price by 18% in after-hours trading. The price has now slightly adjusted to the $26.34 area, but still recorded an increase of 7% compared to the main trading session.
In addition, a memecoin on Solana called GME, of course "not officially" issued, also increased by more than 35% on the day, benefiting from the above news.
It all started with a photo that CEO Ryan Cohen posted on X on February 8, along with Michael Saylor, the billionaire famous for his billion-dollar Bitcoin dream.
There has been speculation that the video game retailer is planning to invest in crypto, but sources told CNBC that GameStop is still considering whether investing in Bitcoin fits into its business model. Saylor was also confirmed to not be involved in GameStop's crypto investment discussions.
Considering investing in crypto is not an entirely new move for GameStop. The company launched a cryptocurrency wallet and NFT marketplace in 2022, but those services were discontinued in 2023 due to regulatory uncertainty.
Under Cohen's leadership, GameStop has largely cut costs and optimized operations so that the company can remain profitable, albeit without much innovation. As of November 2023, GameStop had accumulated $4.6 billion in cash, which it has used for investments.
GameStop is also considered the first example of a "meme stock" succeeding after a short squeeze in 2021. At that time, the company's stock price increased more than 1,000% in just one month, as individual traders joined forces to "turn the tables" on hedge funds that were profiting from shorting GameStop shares. This event later became a historical milestone in the stock market.
However, GameStop is not the first company to explore adding Bitcoin to its balance sheet. Software giant Strategy (formerly MicroStrategy) has accumulated billions of dollars in Bitcoin over the years. This strategy has also strongly boosted the company's stock.
Last week, Japanese game company Gumi bought $6.6 million. Another example is Metaplanet, which aims to own 10,000 Bitcoins by 2025, and currently holds 1,762 BTC, worth about $170 million.
