GameStop Plan to Accumulate Bitcoin as Part of its Treasury Reserve

GameStop, the prominent video game retailer, announced on Tuesday that its board of directors has unanimously approved a plan to invest in Bitcoin with its corporate cash reserves.

The company’s stock jumped, rising over 6% after hours when the news came out. This confirms reports from CNBC in February that GameStop planned to add Bitcoin and other cryptocurrencies to its assets.

The official announcement was in GameStop’s 2024 yearly report, filed with the SEC after the market closed. The company also shared the update on X, saying it can now use Bitcoin “as a Treasury Reserve Asset.”

GameStop, listed on the New York Stock Exchange as GME, closed the day at $25.40, down slightly by 0.82%. But the stock quickly went up 6.3%.

The retail firm noted it might use some of its money, or money from selling stocks and bonds later, to invest in Bitcoin and stablecoins pegged to the U.S. dollar. As of February 1, GameStop had about $4.8 billion in cash. The company hasn’t set a limit on how much Bitcoin it plans to accumulate.

GameStop to Invest in Bitcoin

GameStop’s interest in cryptocurrencies is the newest effort by CEO Ryan Cohen to improve the struggling store business. Since becoming the leader, Cohen has focused on cutting costs and simplifying things to ensure the company makes money.

However, GameStop acknowledged that this move could expose the company to the inherent volatility of cryptocurrency prices.

“We have not set a maximum amount of Bitcoin we may accumulate, and may sell any Bitcoin we may acquire; Bitcoin, for example, is a highly volatile asset and has experienced significant price fluctuations over time. Our Bitcoin strategy has not been tested and may prove unsuccessful,” the firm addressed in its filing.

The world’s leading cryptocurrency has experienced substantial fluctuations since President Donald Trump won reelection. Following a significant surge that surpassed the $100,000 milestone, Bitcoin has declined approximately 18% from its record high, with a recent price hovering around $88,000.

In conjunction with the cryptocurrency announcement, investors welcomed GameStop’s positive fourth-quarter results. The company reported a net income of $131.3 million, more than double the $63.1 million earned during the same quarter of the previous year.

The decision to invest in Bitcoin was formalized through an amendment to GameStop’s investment policy, which received unanimous approval from the company’s board of directors on March 18.