GameStop has announced its acquisition of 4,710 Bitcoin, valued at over $500 million at the time of purchase. The move comes as the retail video game chain struggles to maintain relevance amid a market shift toward digital game purchases. Additionally, GameStop found itself at the center of public attention in 2021 when it became a focal point in a widely publicized short squeeze driven largely by users from Reddit’s r/WallStreetBets community.
Despite the temporary lift in its share value resulting from the 2021 frenzy, GameStop continues to report declining annual net sales. To bolster financial stability and diversify its assets, the company previously informed investors in March of a revised investment approach, explicitly detailing plans to incorporate Bitcoin into its treasury reserves. This BTC acquisition represents the company’s execution on that promise. However, each announcement relating to cryptocurrency has sparked investor hesitancy, evident in the company’s fluctuating stock prices, likely indicating concern about crypto volatility.
GameStop’s pivot into Bitcoin aligns with broader trends in corporate America, influenced by changing sentiments from the U.S. government regarding cryptocurrency. Previously, the Biden administration had adopted a stringent stance against crypto assets, citing worries around corruption, fraud, and financial risk. However, the current Trump administration has introduced a drastic policy shift, formally establishing a National Bitcoin Reserve. Additionally, Trump’s private ventures have increasingly embraced cryptocurrencies, with his media firm undertaking a plan to raise $2.5 billion specifically for Bitcoin acquisitions.
In tandem with growing political alignment around cryptocurrency, President Trump recently made headlines for inviting top holders of his personalized cryptocurrency, a so-called “memecoin,” to a White House dinner. The increasing involvement of the Trump family in cryptocurrency has drawn criticism and accusations of potential market manipulation. In response to these developments, Democratic Senators Chuck Schumer and Jeff Merkley, supported by 17 other Democratic senators, introduced the “End Crypto Corruption Act.” Merkley publicly condemned Trump’s cryptocurrency holdings as ethically problematic, accusing the president of potential conflicts of interest and undermining public trust. However, without bipartisan backing, this legislative initiative is unlikely to make substantial progress.
The federal government’s endorsement of Bitcoin has significantly influenced its market valuation. After dipping to approximately $75,000 per Bitcoin in April, the cryptocurrency surged past a record valuation of $110,000 earlier this month. Major corporations including Tesla, Coinbase, and Block have each invested well over $1 billion into Bitcoin holdings, marking a broader corporate adoption of digital assets as part of treasury management strategies. GameStop’s decisive step into holding cryptocurrency places them firmly alongside these companies at the forefront of Bitcoin investment.