GameStop Corporation is making its move into crypto with plans to invest part of its multibillion-dollar cash reserve into Bitcoin and stablecoins.
After a unanimous approval from its board of directors, GameStop confirmed it will allocate a portion of its corporate cash, and potentially future debt issuances, toward acquiring digital assets like Bitcoin,ย a March 25 CNBC report claimed.
The strategy was outlined in GameStopโs fourth-quarter earnings report, which noted the companyโs updated investment policy now permits holding certain cryptocurrency assets. The report explicitly named Bitcoin and stablecoins as part of its new treasury approach.
โThe Companyโs investment policy permits investments in certain cryptocurrency assets, including Bitcoin and U.S. dollar-denominated stablecoins, and if the Company acquires Bitcoin or U.S. dollar-denominated stablecoins, the Company will be exposed to certain risks associated with Bitcoin or stablecoins, respectively.โ
GameStop Q4 and fiscal year 2024 Results
GameStop (GME) stock initially spiked over 6% in after-hours trading after news broke of its Bitcoin investment plan, but the rally lost steam, and shares ended the day down 0.82% on March 25.
As of February 1, GameStopโs cash pile stood at over $4.77 billion, according to its Q4 earnings report, giving the company plenty of financial room to explore crypto exposure.
While GameStop hasnโt specified how much Bitcoin it plans to purchase, the move echoes a growing trend among corporates to use crypto as a reserve asset.
The buzz around GameStopโs crypto ambitions had already begun earlier this year, when CEO Ryan Cohen posted a cryptic photo with Strategy chairman and Bitcoin advocate Michael Saylor.
Although the post contained no information, speculation that GameStop might be looking into something related to Bitcoin led to a 7% surge in its share price.
Just days later, Strive Asset Management CEO Matt Cole publicly urged GameStop to adopt Bitcoin as a reserve asset. In a letter addressed to Cohen, Cole argued that the move could reshape the companyโs financial future and position it as a pioneer in the gaming industry.
โWe believe GameStop has an incredible opportunity to transform its financial future by becoming the premier Bitcoin treasury company in the gaming sector,โ he wrote on Feb. 24.
