TLDR
GameStop plans to raise $1.4 billion to invest in Bitcoin as a treasury reserve asset
The company will fund purchases through convertible senior notes with 0% interest rate due in 2030
GME stock initially surged 12% but later dropped 8% as traders reacted to the Bitcoin investment plan
GameStop joins other corporations like MicroStrategy (now “Strategy”) adopting Bitcoin on their balance sheets
The company currently holds $4.8 billion in cash and generates about $220 million in interest annually from Treasury bills
GameStop, the video game retailer and meme stock sensation, has announced plans to raise $1.4 billion to invest in Bitcoin as part of its treasury reserve strategy. This marks a major shift in the company’s financial approach as it joins a growing list of corporations adding the leading cryptocurrency to their balance sheets.
On March 26, 2025, GameStop’s board of directors unanimously approved an update to its investment policy to include Bitcoin as a treasury reserve asset. The company’s stock initially rose nearly 12% following the announcement but later dropped more than 8% in after-hours trading as investors digested the news.
The investment committee, led by executive chairman Ryan Cohen, will oversee the allocation of funds toward Bitcoin acquisitions. According to reports, GameStop has not placed a cap on how much Bitcoin it may purchase in the future, indicating a long-term commitment to digital assets.
To fund this Bitcoin initiative, GameStop plans to issue $1.3 billion in convertible senior notes due in 2030. These notes will carry a 0% interest rate, providing the company with financial flexibility without the burden of traditional debt financing.
The notes give buyers the option to convert their holdings into shares at $28.46 or cash. GameStop also mentioned it might increase its cash-raising effort by up to $200 million.
Balancing Treasury Management with Crypto Investment
In addition to the convertible notes, GameStop may use some of its existing cash reserves to further its Bitcoin investment strategy. The company reported $4.775 billion in cash at the end of the fourth quarter.
This move comes about a month after CNBC reported GameStop was exploring cryptocurrency investments. On February 8, GameStop CEO Ryan Cohen posted a picture on X with Strategy (formerly MicroStrategy) CEO Michael Saylor, sparking speculation about GameStop’s interest in cryptocurrency.
Strategy, under Saylor’s leadership, has become known for its heavy investment in Bitcoin, now holding more than 447,000 tokens according to a February filing. The company even rebranded from MicroStrategy earlier this year to emphasize its focus on Bitcoin.
While Strategy’s Bitcoin investment has worked well, with its stock up over 84% in the past year amid rising Bitcoin prices, some Wall Street analysts remain skeptical about GameStop’s new direction.
Wedbush analyst Michael Pachter noted,
“The problem with that thinking is MicroStrategy trades at about two times their bitcoin holdings. If GameStop were to buy all bitcoin with their $4.6 billion in cash and trade at two times [their bitcoin holdings,] the stock would drop five bucks.”
GameStop’s recent financial performance shows some challenges in its core business. In its fourth quarter earnings report, the company posted $1.28 billion in net sales, marking a 28% decline from the same period last year.
For the full fiscal year, GameStop reported an adjusted EBITDA of $36.1 million, down from $64.7 million the previous year. The company’s turnaround efforts have shown some positive results through cost cuts, store closures, and a pivot to collectibles like trading cards.
These measures have helped reduce net operating losses to less than $10 million in each of the past two fiscal years. GameStop has also been generating income by investing its cash in Treasury bills, earning approximately $220 million in interest annually.
Adding Bitcoin to the mix introduces both opportunity and risk. The volatile nature of cryptocurrency could either boost GameStop’s bottom line if Bitcoin’s value increases or potentially reduce the stable returns currently generated by Treasury bills.
GameStop’s Bitcoin investment follows other recent developments in corporate and government adoption of cryptocurrency. Earlier this year, U.S. President Donald Trump signed an executive order establishing a federal Bitcoin reserve using tokens already owned by the government.
The growing trend of corporate Bitcoin adoption signals increasing mainstream acceptance of digital assets. However, it also raises questions about how traditional retailers like GameStop will balance cryptocurrency investments with their core business operations.
As GameStop moves forward with this new financial strategy, investors and industry observers will be watching closely to see how the company executes its vision and whether the Bitcoin investment pays off in the long run.
