Following the announcement of this news, the value of GameStop’s shares increased by almost three percent in premarket trading.
GameStop, an American retailer specializing in the sale of video games and gaming equipment, announced on Wednesday that it had purchased 4,710 bitcoins, worth more than half a billion dollars, following a move made in August 2020 by American software company MicroStrategy, which then acquired 21,454 bitcoins for $250 million.
GameStop invested $512.6 million in bitcoin, with the price of bitcoin being $108,837. The world’s largest cryptocurrency has recently risen strongly, reaching a near-record $112,000 last week. Easing trade tensions and Moody’s downgrading of the US credit rating have further fueled investor interest in bitcoin, CNBC reports.
GameStop shares rose nearly 3 percent in premarket trading after the news.
GameStop is often called a “meme stock” because its surge in early 2021 was driven primarily by viral online communities like the Reddit group r/WallStreetBets, rather than by traditional market factors. The stock is up about 12 percent this year.
GameStop’s move into cryptocurrency is part of CEO Ryan Cohen’s plan to revive the company’s business, which has been hit hard by the closure of physical stores.
Under Cohen’s leadership, the company has focused on cutting costs and streamlining operations to remain profitable over the long term.
Details
GameStop Corp. is an American video game, consumer electronics, and gaming merchandise retailer. The company is headquartered in Grapevine, Texas (a suburb of Dallas) and is the largest video game retailer in the world.
The increase in the shares of this company took place at the beginning of 2021. The shares of this company reached a value of over 500 dollars, thirty times higher than the price at the beginning of the month. The reason for this is the internet community r/wallstreetbets, whose members, small investors, decided to buy a large number of shares of this company, after which the price increased.