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On March 27, GameStop’s market capitalization dropped by nearly $3 billion as investors grew skeptical about the company's plan to accumulate Bitcoin, according to Google Finance.
The previous day, March 26, GameStop tipped plan to use proceeds from a $1.3 billion convertible debt offering to purchase Bitcoin—an increasingly common strategy for public companies aiming to enhance stock performance.
The announcement followed GameStop’s proposal to build a cryptocurrency reserve, including Bitcoin and US dollar-pegged stablecoins.
Initially, investors responded positively, pushing GameStop’s stock (GME) up by 12% on March 26. However, sentiment reversed sharply the next day, with GME plunging nearly 24%, according to Google Finance.
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Source: Google Finance
Investor Concerns
Analysts believe the negative reaction reflects doubts about GameStop’s broader business strategy.
“Investors are not necessarily optimistic about the core business,” said Bret Kenwell, a U.S. investment analyst at eToro, told Reuters interview on March 27.
“There are uncertainties surrounding GameStop’s model. If Bitcoin is intended to be the pivot, what happens to everything else?”
The sell-off also highlights investors’ growing bearishness toward Bitcoin, as global economic challenges, including ongoing trade wars, put pressure on the cryptocurrency’s price.
As of March 27, Bitcoin is down approximately 7% year-to-date, hovering around $87,000, according to Google Finance.
Although Bitcoin’s price briefly rose to $89,000, it has since declined, noted Agne Linge, head of growth at decentralized finance (DeFi) protocol WeFi. Linge added that U.S. President Donald Trump’s tariff-driven trade wars remain a significant concern for traders.
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Source: BitcoinTreasuries.NET
Corporate Bitcoin Treasuries
GameStop is a relatively late entrant among public companies building Bitcoin reserves.
In 2024, rising Bitcoin prices drove shares of Strategy up by more than 350%, according to FinanceCharts.
Founded by Michael Saylor, Strategy has spent over $30 billion acquiring Bitcoin since it pioneered corporate Bitcoin accumulation in 2020, according to BitcoinTreasuries.NET.
Inspired by Strategy’s success, many other companies have followed suit. As of March 27, public companies collectively hold nearly $58 billion worth of Bitcoin, according to the data.