GameStop stock on watch after buying 4,710 BTC

GameStop doubles down on its memestock status by investing more than half a billion dollars in Bitcoin.

GameStop is doubling down on its crypto pivot. On Wednesday, May 28, GameStop announced on social media that the company acquired 4,710 Bitcoin (BTC). The purchase was worth approximately $519 million, with each BTC valued at $109,728 at the time. The stock was higher by more than 3% ahead of Thursday’s opening bell.

The news followed the company’s completion of a $1.5 billion convertible of senior notes on April 1. The sale aimed to leverage GameStop’s memecoin status to buy Bitcoin and boost its share price and appeal to investors.

This wasn’t the first time the video game retailer bought Bitcoin. On March 25, GameStop approved a plan to convert a portion of its $4.77 billion in cash reserves into Bitcoin. However, it did not disclose how much of the reserves would be converted.

Can Bitcoin save GameStop?

The latest move into Bitcoin appears to be an attempt by GameStop to rescue its struggling business by emulating Michael Saylor’s strategy. Back in February, GameStop CEO Ryan Cohen posted a picture with Saylor, a gesture many traders saw as a signal of the company’s Bitcoin pivot.

For now, the strategy appears to be working. Following the latest $519 billion Bitcoin purchase, GameStop’s stock rose 5.99% to $35 per share. Moreover, since first hinting at its Bitcoin pivot in February this year, the stock price rose 40%, from $25, which was its price at the time.

GameStop is just one of the companies that is trying to copy Saylor’s Strategy in an effort to boost its stock valuation. For instance, on May 28, Japanese Metaplanet issued $50 million in bonds to expand its Bitcoin purchases. What is more, just one day earlier, Donald Trump’s Trump Media & Technology Group announced plans to acquire $2.5 billion in Bitcoin.