GameStop officially incorporates Bitcoin into its treasury reserve, GME stock price jumps over 12%
Do you remember GameStop, which sparked the "retail investors vs. Wall Street" battle? It's making headlines again! On March 25, the board of directors of this gaming retailer unanimously passed a resolution to officially include Bitcoin in the company's treasury reserve assets. As soon as the news broke, the company's stock price soared 12.23% in after-hours trading, reaching a closing price of $28.58 yesterday.
This transformation is quite dramatic. Just last month, GameStop CEO Ryan Cohen posted a photo with "Bitcoin evangelist" Michael Saylor on social media, and the market sensed something was brewing. Now that the dust has settled, although the company has not disclosed the specific investment amount, it has clearly stated that it will use cash reserves or raise funds through debt/equity to increase its Bitcoin holdings.
GameStop's move actually has a precedent. In the fourth quarter of last year, through aggressive cost-cutting, the company's net profit surged from $63.1 million to $131.3 million. With extra cash on hand, and traditional gaming retail business growth stagnating, choosing Bitcoin as a reserve asset is not difficult to understand.
Interestingly, this is not GameStop's first foray into the crypto space — it launched an NFT wallet in 2022, which was shut down in 2023 due to regulatory uncertainty, but now it seems to be making a comeback.
Looking at the market, GameStop is not alone. From MicroStrategy (now renamed Strategy) holding 506,000 Bitcoins to Japan's Metaplanet becoming an Asian "Bitcoin heavyweight", the trend of public companies allocating Bitcoin has emerged. Even the video platform Rumble has announced a $20 million investment. This corporate-level demand is becoming an important force driving Bitcoin prices.
However, investing in Bitcoin is also a double-edged sword for companies. Strategy's latest financial report shows that its Bitcoin holdings have appreciated by over $10 billion; on the other hand, Bitcoin's high volatility may also bring significant fluctuations to corporate financial reports. Whether GameStop can manage this risk remains to be seen.
In summary, as more listed companies follow suit, the narrative of Bitcoin as a "corporate reserve asset" is accelerating, which may reshape the interaction between cryptocurrencies and traditional finance.
