GameStop has announced plans to raise up to $1.75 billion through an offering of convertible senior notes. This significant capital raise follows the company’s recent strategic move into cryptocurrency, specifically its purchase of 4,710 Bitcoin valued at approximately $512 million.
The company has formally updated its investment policy to explicitly include Bitcoin as a Treasury Reserve Asset. This policy shift aligns GameStop with a growing trend among institutions incorporating cryptocurrency into their corporate treasury management strategies.
Market reaction to the funding announcement was negative, with GameStop’s stock declining 10% in after-hours trading. This continues a downward trend observed since the initial Bitcoin purchase was disclosed.
GameStop enters this funding round with substantial liquidity, reporting cash reserves of $4.7 billion as of its last quarterly report. These reserves are intended to support operational needs and strategic investments, including potential further Bitcoin acquisitions.
The strategic direction appears influenced by CEO Ryan Cohen’s association with prominent Bitcoin advocate Michael Saylor, suggesting alignment with experienced figures in the cryptocurrency investment space.