GameStop Announces It Has Made $500 Million Investment

GameStop has officially made its first cryptocurrency investment. 

In 2021, a short squeeze of GameStop's stock became one of the biggest topics in the world. The largest video game retailer in the world doesn't have another phenomenon on its hands, but it did go viral because of Wednesday's announcement. 

GameStop revealed that it purchased over $500 million worth of Bitcoin. The company confirmed the purchase of 4,710 Bitcoin with a statement on social media. 

This purchase isn't that surprising. On March 26, GameStop's board of directors approved Bitcoin as a treasury reserve asset. That led to its stock price increasing. 

GameStop expects to use the net proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin in a manner consistent with GameStop’s Investment Policy.

Since announcing its purchase of Bitcoin, shares of GameStop have dropped roughly 10% this Wednesday. This shouldn't discourage GameStop's plans moving forward. The company is hoping this is a long-term play, not a one-day revival.

"If the thesis is correct, bitcoin and gold as well can be a hedge against global currency devaluation and systemic risk," GameStop CEO Ryan Cohen said, via CNBC. "Bitcoin has certain unique advantages compared to gold, the portability aspect of it. It’s instantly transferable across the globe.. It’s instantly verified via the blockchain... there’s the scarcity element of it as well. 

"GameStop is following GameStop’s strategy. We’re not following anyone else’s strategy."

Only time will tell if adding Bitcoin to its treasury saves GameStop.