GameStop Buys $513M Bitcoin Amid 28% Revenue Decline

GameStop has made a significant move into cryptocurrency by purchasing 4,710 Bitcoins valued at over $500 million, funded through a $1.4 billion convertible note sale. This purchase aligns with GameStop's strategic diversification plan, adding Bitcoin as a treasury reserve asset approved by its board in March, aiming to hedge against retail sales decline and global currency devaluation. Despite the bullish momentum in GameStop's shares following the announcement, the stock experienced volatility, including a notable drop of more than 4% after initially rising. CEO Ryan Cohen emphasized Bitcoin's unique advantages over gold, highlighting its portability, instant verification via blockchain, and scarcity, positioning the move as a long-term investment rather than a short-term boost. While some analysts see the Bitcoin acquisition as a smart hedge, others warn about the risks involved, including Bitcoin's price volatility and regulatory uncertainties, especially given GameStop's 28% revenue decline and high valuation. The company’s diversification into digital assets, blockchain gaming, and NFTs reflects its broader strategy to modernize amid challenges in its core retail business.