GameStop Confirms Bitcoin Buy-In, Flaunts $4.8B War Chest in Mixed Q4 Results
GameStop moves to emulate Strategy’s bold crypto playbook; GME stock jumps as meme legend re-enters spotlight.
GameStop (NYSE: GME) just took its most audacious swing yet—and it’s not at the bargain bin. The original meme stock darling confirmed late Tuesday that it will begin buying Bitcoin (BTCUSD), adding the world’s largest cryptocurrency to its balance sheet as a treasury reserve asset. The move immediately jolted GME shares, sending them up more than 8% in after-hours trading.
In a brief but bold statement, GameStop said its board “unanimously approved an update to its investment policy to add Bitcoin as a treasury reserve asset.” The company added that it has not set a limit on how much Bitcoin it may purchase or hold and reserves the right to liquidate at any time.
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Following the Strategy Playbook
The announcement marks a significant shift for the video game retailer, which ended its fourth quarter with a formidable $4.775 billion in cash, cash equivalents, and marketable securities. That stockpile now becomes the ammunition for its Bitcoin ambitions.
GameStop’s decision echoes a path forged by Strategy (NASDAQ: MSTR), the enterprise software firm formerly known as MicroStrategy. Led by Michael Saylor, Strategy has transformed into a Bitcoin proxy for investors, holding over 447,000 BTC and watching its stock soar more than 84% over the past year.
In a February social media post, GameStop CEO Ryan Cohen posted a photo of himself alongside Saylor, igniting rumors of a potential crypto play. The speculation proved accurate. Tuesday’s filing confirmed that Cohen now holds full control over GameStop’s investment strategy and intends to use a portion of the company’s cash or future capital raises to buy Bitcoin.
— Ryan Cohen (@ryancohen) February 8, 2025
Wall Street Weighs In
The move places GameStop in the company of other crypto-curious publicly traded firms such as Robinhood (NASDAQ: HOOD) and Coinbase (NASDAQ: COIN), both of which have integrated Bitcoin into their business models.
Michael Pachter, managing director at Wedbush Securities and a longtime industry observer, remains skeptical. Speaking to Barron’s, Pachter said, “It is unfathomable that they will ever turn their core business (selling games) around by offering trading cards in their stores.”
Pachter also addressed the new Bitcoin strategy head-on, comparing it to Strategy’s model, stating:
MicroStrategy trades at around twice the value of its Bitcoin holdings, so it remains to be seen if Ryan Cohen can find a better cryptocurrency to invest in and drive GME shares to 2.6 times the value of its assets.
Strong Earnings, Weak Sales
The strategy shift arrives as GameStop continues to grapple with a sharp decline in its core business. The company also reported its Q4 earnings after the bell Tuesday, with sales dropping 28% year-over-year to $1.283 billion, missing analysts’ expectations by nearly $200 million. Still, the company surprised Wall Street with better-than-expected earnings: adjusted EPS came in at $0.30 versus the $0.08 forecast.
Despite the sales miss, net income more than doubled year-over-year, reaching $131.3 million for the quarter. The company also completed its exit from Italy and continued winding down operations in Germany, further trimming costs as it tries to stabilize its bottom line.
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Crypto Move Sparks Retail Frenzy
Yet for many retail investors, earnings results took a backseat to the headline-grabbing Bitcoin news.
Social media buzz exploded following the announcement. On Stocktwits, GameStop became the top trending ticker as investors weighed the implications of the company’s evolving identity—from gaming chain to crypto treasury play.
Not everyone is cheering the pivot. In its SEC filing, GameStop acknowledged the risks, stating, “Bitcoin, for example, is a highly volatile asset and has experienced significant price fluctuations over time. Our Bitcoin strategy has not been tested and may prove unsuccessful.”
A Push from Shareholders—and Roaring Kitty
Still, others see opportunity in the chaos. Joe Heck, CEO of Zip US, a GameStop partner offering installment payments for gaming purchases, pointed to the company’s loyal customer base. “Gaming is one of Zip’s most popular categories overall, making Zip an ideal partner for helping these shoppers responsibly purchase goods and services from one of the industry’s fan-favorites and top businesses,” Heck said in a March 3 press release.
Matt Cole, CEO of Strive Asset Management, took it a step further. In a February letter to Cohen, Cole urged GameStop to leverage its multibillion-dollar cash reserve and become the “premier Bitcoin treasury company in the gaming sector.” Cohen acknowledged receipt of the letter with a cryptic post: “Letter received.”
For some, the pivot to crypto is the latest twist in a saga that’s been anything but ordinary. GME shares remain well below their meme-era highs but have rebounded 64% over the past 12 months—buoyed in part by the return of retail icon Keith Gill, aka “Roaring Kitty,” who resurfaced in 2024 to declare himself still a “believer” in the company.
High Stakes for the Meme King
While the Bitcoin strategy raises eyebrows, it’s not GameStop’s first dance with crypto. 2022 the company launched its own NFT marketplace and digital wallets, only to shut them down in 2023 due to “regulatory uncertainty.” This new approach, however, is far less operational and far more financial.
In many ways, GameStop is gambling that its pivot to a Bitcoin-centric treasury model can buy it time and maybe even relevance as it struggles to reimagine its business in an increasingly digital and decentralized world.
As Bitcoin continues hovering near the $88,000 mark, investors will be watching closely to see how much GME commits—and how markets respond. The crypto playbook worked for Strategy. Now, GameStop, with billions in dry powder, is hoping for a similar payoff.
One thing is sure: GameStop isn’t playing it safe under Ryan Cohen.
And neither are its shareholders.
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Disclaimer: Wealthy VC does not hold a position in any of the stocks, ETFs or cryptocurrencies mentioned in this article.
