(Bloomberg) – Gamestop Corp., a struggling video game retailer who became a retailer’s favorite during the 2021 memestock frenzy, said its board has approved plans to add Bitcoin as a Treasury reserve asset.
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The Grapevine, Texas-based company is on an increasing list of public companies experimenting with using the company’s cash or borrowed money to take advantage of the Bitcoin surge. Gambit was pioneered by Michael Saylor’s strategy. Michael Saylor’s strategy is an enterprise software company officially known as MicroStrategy, which has acquired over $40 billion in Bitcoin and has seen its stock price rise.
Last month, Gamestop CEO Ryan Cohen teased the idea and posted a photo of herself and Saylor on the X social media platform. GameStop shares rose about 6% after trading. So far this year, stock prices have fallen by around 19%.
From medical technology providers to hotel developers, a variety of businesses have been inspired by the rise of strategies. Since co-founder Saylor began investing in Bitcoin in 2020 as a hedge against inflation, stock prices have risen by more than 2,600%. Cryptocurrency rose nearly 700% over the same period.
A wave of companies following in the footsteps of the strategy has seen stock prices surge after announcing plans to buy Bitcoin. Public companies that hold large bitcoin holdings that have a balance sheet have seen an influx from investors who don’t deal with Bitcoin directly but want to be exposed to asset classes in the stock market. Many Bitcoin mining companies, including Mara Holdings Inc., Riot Platforms Inc. and Crypto Exchange Coinbase Global Inc., also proxies for Bitcoin in their markets.
GameStop has a fundamental business struggling, but it has become fame when memestock traders piled up on stocks amid the retail frenzy during the pandemic.
GameStop announced its fourth quarter revenue fell 28% from the previous year to $1.28 billion. Hardware and accessories sales and software both declined in the quarter, but collectible sales increased.
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