Investors flee GameStop following $500 million Bitcoin splurge
Gamestop, the besieged video gaming seller, announced the first major acquisition of Bitcoin on Wednesday, as it revealed the purchase of more than $ 500 million of the currency as part of the company’s attempt to enhance its sick profits.
Gamestop purchased 4,710 Bitcoins, according to a statement. However, although similar investments were a blessing for other companies, Gamestop has not yet gained benefits from its axis to encryption.
After a preliminary trading in pre -market trading after the announcement, Gamestop shares fell by 10 % on Wednesday morning, as investors expressed their dissatisfaction with the new financial strategy of the company.
The purchase of millions of dollars is a former advertisement from the company that it will turn its strategy away from selling video games to investo in Crypto. The initial plan included the collection of $ 1.3 billion by providing debt financing to investors in the form of convertible notes, according to the SEC report from March. “Providing adequate liquidity to meet the company’s daily financial obligations and improve investment revenues,” said the goal file of the new strategy.
Gamestop shares fell 23 % on the news, but the company continued to raise $ 1.5 billion in a special offer for investors in April, which is specifically dedicated to Bitcoin.
The shift to investment in encryption seems to be an attempt to simulate the strategy (previously known as Microstrategy), a veteran software company that stimulates Bitcoin in 2020 and has witnessed stock prices by 2700 % over the past five years. Other companies also make similar moves, including Twenty One Capital, a new entity created through a partnership with Cantor Fitzgerland and many other companies, and the Trump Media and Technology Group, a media company supported by the American president’s family.
But Vitaliy Shtyrkin, chief product employee at Crypto Payment Processor B2BINPAY, says Bitcoin may not be the treatment that all gamestop hopes. It provides currency brand fluctuations, which makes it attractive to strategic investors, new risks for Gamestop investors, and its shares are already suffering from low video game sales. luck.
“Bitcoin is exciting to the rule of loyal investors, but it distracts the attention of the basic basics: if the encryption prices decrease, Gamestop may end easily in a double band,” says Shtyrkin.
Over the years, Gamestop has struggled to keep pace with the transformation of material video games to this digital. Between 2023 and 2024, Gamestop sales decreased by 28 %, and decreased from $ 5.3 billion to $ 3.8 billion. As a result, the company was forced to close a quarter of its sites during the past year and plan to close a large number of stores in 2025.
Gamestop’s transformation into Bitcoin is not the first sudden development in the company’s history. The video game retailer became known as “Meme Stock” in 2021 after the company’s shares rose unexpectedly after a group of Redditors made a viral trend to invest in it.
This story was originally shown on Fortune.com
2025-05-28 15:53:00
