GameStop, with $4.6 billion cash pile, might follow Saylor’s Bitcoin playbook, say analysts

• GameStop’s $4.6B cash reserve may prompt Bitcoin adoption as a treasury asset.
• MicroStrategy’s Bitcoin strategy influenced GameStop’s potential move toward crypto.
• GameStop’s new investment policy opens the door for digital asset investments.

GameStop CEO Ryan Cohen met with Michael Saylor of Saylor’s Strategy (formerly MicroStrategy) to discuss using Bitcoin as a treasury asset, as the company sits on a $4.6 billion cash reserve.

That $4.6 billion cash reserve, built from shareholder reduction and a belief in Cohen’s ability to turn the company around, is a wasting asset. It’s declining in real value each year thanks to inflation.

The rise of Bitcoin as a corporate treasury asset has been spearheaded by Saylor’s Strategy (formerly MicroStrategy), a software firm that turned its balance sheet into a Bitcoin-heavy one. 

Related: GameStop Shares Skyrocket Amid Renewed Retail Investor Fervor

The firm, led by Michael Saylor, has made billions of dollars worth of Bitcoin purchases, with its stock experiencing volatility. This approach has inspired others, including companies like Metaplanet, which recorded an increase of 3,000% in stock value by adopting Bitcoin as a major asset.

GameStop’s Digital Asset Moves

GameStop dabbled in digital assets, launching a crypto wallet in 2022 to enable users to manage crypto and NFTs. 

However, the company shut down this service in 2023 due to “regulatory uncertainty.” Despite this setback, the recent meeting between Ryan Cohen and Michael Saylor raises questions about whether the company will explore digital assets again as part of its strategy. 

In 2023, GameStop’s board approved a new investment policy that allows Cohen and other board members to manage the company’s securities portfolio. This gives them the green light to invest in Bitcoin or other digital assets, provided they align with the board’s guidelines.

Related: Michael Saylor: Bitcoin Reserve Could Generate $10T Annually for the US Economy

The timing for GameStop to enter the Bitcoin space could be perfect. With Bitcoin becoming more widely accepted as a corporate treasury asset and new accounting rules making it easier for companies to hold Bitcoin on their balance sheets, Bitcoin could significantly change GameStop’s financial trajectory – and its stock price.