GameStop Proposed to Convert $5B Cash Reserves to Bitcoin

GameStop, the iconic video game retailer, has received a proposal from Strive Asset Management to convert nearly $5 billion in cash reserves into Bitcoin. The proposal, dated February 24 and signed by Strive CEO Matt Cole, was acknowledged by GameStop Chairman and CEO Ryan Cohen, who posted "Letter received" on social media on Tuesday without elaborating further.

The proposal argues that Bitcoin is a superior alternative to holding cash, which it describes as a "shrinking asset" due to inflation. It points to recent accounting rule changes allowing companies to recognize unrealized Bitcoin gains as profit, making it a more attractive corporate treasury asset. The firm also urged GameStop to avoid investing in other cryptocurrencies, calling Bitcoin the only "true store of value" among digital assets.

Strive's proposal also called for a reduction in GameStop's retail footprint, applauding its exit from Canada, France, and Germany while recommending further store closures as the industry shifts toward digital game sales. It suggested that the company focus on e-commerce and AI-driven services rather than maintaining unprofitable physical locations.

To fund Bitcoin purchases, Strive proposed that GameStop raise additional capital through at-the-market stock offerings and convertible debt securities, arguing that its high trading volume makes such moves viable. Strive said Bitcoin's scarcity and increasing institutional adoption position it as a long-term hedge against inflation and a strategic reserve asset.

The proposal comes as Bitcoin trades below $89,000, down from a peak of over $109,000 in January. The broader crypto market has faced heightened volatility, with a $1.5 billion hack on exchange Bybit adding to uncertainty.

Cohen has remained largely silent on the company's long-term strategy but has previously indicated a shift toward a leaner model, focusing on "value-added" items. Earlier this month, the CEO posted an untitled picture standing next to Strategy CEO Michael Saylor, further adding to speculation Cohen is mulling Bitcoin as a viable investment.