GameStop Makes Its First Bitcoin Purchase. From Meme Stock to the Next MicroStrategy? — Barrons.com
By Mackenzie TatananniGameStop said Wednesday that it had made its first Bitcoin purchase, taking a page out of MicroStrategy's book in pursuit of its own treasury aspirations.The videogame retailer said in a press release that it had snapped up 4,710 Bitcoins over an unspecified period. The report was light on details, but based on the current price of the cryptocurrency, GameStop's holdings are valued at over $5.12 billion.The poster child for meme stocks indicated earlier this year that it was looking to create a Bitcoin treasury. While the press release Wednesday didn't state the purpose of the crypto purchase, it is almost certainly a first step.It's impossible not to draw parallels to MicroStrategy, now doing business as Strategy, the software company-turned-investment vehicle. Strategy started buying crypto in 2020 as it chased its own ambitions of becoming the world's first Bitcoin treasury company.Strategy has since grown into the largest corporate holder of Bitcoin and is commonly viewed as a way to gain exposure to the digital currency without holding it outright. (The company rebranded earlier this year to feature a tiny Bitcoin symbol as part of its logo).And it just keeps buying more. Strategy said Monday that it had expanded its Bitcoin holdings to more than 580,000 digital tokens acquired at an aggregate price of $40.61 billion. The company funds its purchases through the proceeds of several different at-the-market programs.For GameStop, a Bitcoin treasury is uncharted territory. As one of the best-known meme stocks, GameStop is subject to bouts of short selling and speculation in online communities. Shares took off in January 2021 amid a now-infamous short squeeze.In short, GameStop's latest purchase hardly makes it a MicroStrategy. It is nowhere near a leveraged play on the crypto, but its treasury aspirations signal that GameStop is leaning even more heavily into becoming an investment-holding company.GameStop expounded on this shift in March via a similarly short press release. The company announced that its board had unanimously approved an update to its investment policy to add Bitcoin as a treasury reserve asset.At the time, shares fell double-digits as investors digested the news. While Wednesday's market reaction was less severe, it carried the same sentiment. GameStop declined 3.6% to $33.76. The benchmark S&P 500 rose 0.2%.Bitcoin has fallen 0.9% over the past 24 hours to $108,959, according to CoinDesk. The price has fallen from its peak after crossing its previous record level of $109,000 last week and notching an all-time high near $112,000.Write to Mackenzie Tatananni at [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.