GameStop follows MicroStrategy, raises $1.3B for Bitcoin buy

GameStop Corp. is making waves once again, this time with a high-stakes move into cryptocurrency. The video game retailer plans to sell $1.3 billion in convertible bonds to finance Bitcoin purchases, adopting a strategy popularized by MicroStrategy’s Michael Saylor.

On Tuesday, GameStop’s board approved the decision to add Bitcoin as a treasury reserve asset, signaling a shift in its financial strategy. A regulatory filing on Wednesday confirmed that proceeds from the bond sale would be allocated for general corporate purposes, including acquiring Bitcoin. 

The bonds, set to mature in 2030, carry a conversion premium of 35% to 40%, lower than the 55% premium offered in a similar MicroStrategy bond sale last November.

GameStop’s move is reminiscent of MicroStrategy, which has accumulated over $40 billion in Bitcoin through a similar debt-financing approach. However, the market’s response to such strategies appears to be shifting. Investors were more receptive when MicroStrategy launched its Bitcoin-backed bonds in late 2024, but recent offerings suggest growing caution. 

A $2 billion bond sale by MicroStrategy in February had a 35% conversion premium, signaling investors are now demanding better terms.

GameStop’s big Bitcoin bet had investors excited, pushing shares up 11.6% to $28.35 in pre-market trading on Wednesday. But the hype didn’t last—by after-hours, the stock slid 6.6% to $26.44. Given its meme-stock past, volatility is nothing new for GameStop, and this latest move only fuels the unpredictability.

Bitcoin isn’t exactly soaring either. Trading around $88,000, it has dropped nearly 18% from its January peak, with economic uncertainty, trade policy shifts, and investor caution weighing it down. GameStop, meanwhile, is battling its own struggles—fourth-quarter revenue sank 28% to $1.28 billion, with hardware, accessories, and software sales all taking a hit.

GameStop isn’t selling new shares to raise cash. Instead, it’s taking a different route—pulling in $1.3 billion through convertible bonds. That way, shareholders don’t immediately feel the impact, but it also means the company is betting big on Bitcoin’s price swings. If Bitcoin makes a strong comeback, this could be a smart play. If not, GameStop might find itself in an even tougher spot financially.

With more businesses following this Bitcoin-backed funding approach, it’s only a matter of time before regulators start cracking down.