GameStop stock slides as company announces $500 million bitcoin purchase
GameStop (GME) stock sank more than 3% on Wednesday after the the video game retailer announced it has purchased 4,710 bitcoin (BTC-USD).
With bitcoin trading around $108,000 per token in early trading, the investment is valued at over $500 million. The token reached a record high north of $111,000 last week.
In March, the company led by billionaire Ryan Cohen formally announced its board unanimously approved adding the cryptocurrency as a treasury reserve asset.
Subsequently, the meme stock tumbled nearly 25% in one session after the retailer said it intended to raise $1.3 billion via convertible senior notes to purchase bitcoin.
Public companies have increasingly added bitcoin to their balance sheets, following the lead of Strategy (formerly MicroStrategy) (MSTR), the largest corporate holder of bitcoin.
On Tuesday Trump Media & Technology Group (DJT) unveiled plans to raise $2.5 billion in order to create what it claims will be one of the largest bitcoin treasuries held by any public company.
Shares of Trump Media, which are majority owned by President Trump, fell over 10% following the announcement.
Bernstein analyst Gautam Chhugani points to increasing corporate adoption of bitcoin as a bullish sign for the token.
"Globally, ~80 corporates have adopted the 'Bitcoin Standard,' adding BTC to their treasuries and now holding approximately 3.4% of total supply," wrote Gautam Chhugani earlier this month.
That amounts to roughly 720,000 tokens — up 160% from the 270,000 held at the end of 2023. Bernstein forecasts bitcoin will reach $200,000 by year-end.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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