GameStop's CEO Sparks Bitcoin Investment Speculation After Meeting With MicroStrategy's Saylor

GameStop, the prominent video game retailer, has recently sparked speculation about its potential entry into the cryptocurrency market. This speculation intensified after CEO Ryan Cohen shared a photograph with Michael Saylor, the co-founder of MicroStrategy, a well-known advocate for Bitcoin. The photograph, posted on social media, showed Cohen and Saylor together, leading many to speculate that GameStop might be considering investing in Bitcoin.

This is not the first time GameStop has been linked to cryptocurrency. Earlier this year, the company announced that it was exploring the possibility of accepting cryptocurrency as a form of payment. However, this latest development suggests that GameStop might be considering a more significant investment in the cryptocurrency market. The potential investment in Bitcoin by GameStop would be a significant development for the cryptocurrency market. Bitcoin has gained popularity in recent years as a store of value and a hedge against inflation. However, it remains a volatile asset, and its price can fluctuate significantly. If GameStop were to invest in Bitcoin, it would be a vote of confidence in the cryptocurrency's potential as a long-term investment.

The potential investment in Bitcoin by GameStop would also be a significant development for the company itself. GameStop has been struggling in recent years as the video game industry has shifted towards digital distribution. An investment in Bitcoin could provide the company with a new revenue stream and help it to diversify its business. However, it would also come with risks, as the cryptocurrency market is still relatively new and unregulated. The potential investment in Bitcoin by GameStop has also raised questions about the company's long-term strategy. GameStop has been undergoing a significant transformation in recent years, as it has shifted its focus towards e-commerce and digital distribution. An investment in Bitcoin would be a significant departure from the company's traditional business model, and it remains to be seen how it would fit into its long-term strategy.

Last month, GameStop received a proposal from Strive Asset Management recommending the video game retailer become a “premier Bitcoin treasury company in the gaming sector” by converting its cash reserves into Bitcoin. Cohen acknowledged Strive's proposal on social media, stating, “Letter received,” without elaborating further. Several companies in the U.S. have embraced Bitcoin as a treasury reserve asset, but the practice was pioneered by MicroStrategy, which has been buying Bitcoin since 2020. Before acknowledging Strive’s proposal last month, Cohen posed alongside Saylor in a photo he posted to social media. Cohen, who founded the online pet supplies store Chewy, has stockpiled cash at the video game retailer since stepping into the role nearly a year and a half ago. He was first named the company’s executive chairman after Matt Furlong, who tried unsuccessfully to launch NFT collectibles, was terminated. As of November 2, GameStop held $4.6 billion in cash and cash equivalents, compared to $900 million a year prior, according to a Securities and Exchange Commission filing.

In early 2021, GameStop became a flashpoint for retail investors. Legions of users on the Reddit forum partook in a coordinated effort to bet against Wall Street firms and trigger a short squeeze. A short squeeze can occur when short sellers are forced to buy shares to cover their positions, driving the stock price up further. GameStop’s stock price peaked in 2021 around $95, after trading around $5 a month before. The company’s stock changed hands at $25.35 on Tuesday morning, up 90% from a year ago. Still, GameStop shares have swooned 17% from $30.66 at the start of this year. Years ago, Saylor was linked to several firms adopting Bitcoin as a treasury reserve asset, including Tesla. The automaker disclosed its first Bitcoin purchase in February 2021, months after Saylor publicly urged the firm to buy Bitcoin.