Staff Reporter
GameStop, the video game retailer that gained fame as a meme stock, is reportedly exploring the possibility of investing in bitcoin and other cryptocurrencies, according to sources familiar with the situation.
The company is looking into alternative asset classes, with a particular focus on cryptocurrencies like bitcoin. Following this news, GameStop’s shares surged by as much as 20% in after-hours trading.
However, the retailer has not yet made a definitive decision regarding these investments. One insider mentioned that GameStop is still evaluating whether this strategy aligns with its business objectives.
Recently, CEO Ryan Cohen shared a photo on social media platform X with Michael Saylor, the co-founder and chairman of MicroStrategy, which is the largest corporate holder of bitcoin. Despite this connection, two sources confirmed that Saylor is not currently involved in GameStop’s discussions about cryptocurrency investments.
In 2022, GameStop introduced crypto wallets that allowed users to manage their cryptocurrencies and non-fungible tokens (NFTs). However, the company discontinued this service in 2023, citing “regulatory uncertainty.”
Ryan Cohen, co-founder of Chewy, made headlines when he purchased shares in GameStop in 2020 and joined the board in 2021, as the company emerged as a leading meme stock during the trading frenzy.
His background in e-commerce raised expectations that he could help modernize the traditional brick-and-mortar retailer. However, GameStop continues to struggle with shifting consumer spending habits among gamers.
Under Cohen’s leadership, GameStop has prioritized cost-cutting and streamlining operations to maintain profitability, despite stagnant growth. As of November 2, the company reported a substantial cash reserve of $4.6 billion, which it has been using for various investments, according to a December securities filing.
In the context of growing interest in cryptocurrencies, companies like GameStop are considering adding bitcoin to their balance sheets, following the example set by MicroStrategy. Recently rebranded as Strategy, MicroStrategy has invested billions in bitcoin, successfully shifting its identity from a software company to a major cryptocurrency holder. This strategic pivot has resulted in a rapid, albeit volatile, rise in Strategy’s stock value.
In December 2023, GameStop’s board approved a new investment policy that empowers Cohen, along with two independent board members and key staff, to manage the company’s investment portfolio. Any investments must adhere to the policy’s guidelines or receive approval through a unanimous vote from the committee or a majority vote from the entire board.
