GameStop (GME) stock sank more than 10% on Wednesday after the video game retailer announced it purchased 4,710 bitcoin (BTC-USD).
With bitcoin trading around $108,000 per token, the investment is valued at over $500 million. The token reached a record high north of $111,000 last week.
In March, the company, led by billionaire Ryan Cohen, formally announced that its board unanimously approved adding the cryptocurrency as a treasury reserve asset.
Subsequently, the meme stock tumbled nearly 25% in one session after the retailer said it intended to raise $1.3 billion via convertible senior notes to purchase bitcoin.
Public companies have increasingly added bitcoin to their balance sheets, following the lead of Strategy (formerly MicroStrategy) (MSTR), the largest corporate holder of bitcoin.
On Tuesday, Trump Media & Technology Group (DJT) unveiled plans to raise $2.5 billion to create what it claims will be one of the largest bitcoin treasuries held by any public company.
Shares of Trump Media, which are majority owned by President Trump, fell over 10% following the announcement.
“We’re at a space where people are racing to put this on their balance sheet,” BitcoinIRA co-founder & coo Chris Kline told Yahoo Finance on Wednesday morning.
“With the hype and expected price movements ahead… that’s a huge growth in the balance sheet for these groups,” he added.
Bernstein analyst Gautam Chhugani points to increasing corporate adoption of bitcoin as a bullish sign for the token.
“Globally, ~80 corporates have adopted the ‘Bitcoin Standard,’ adding BTC to their treasuries and now holding approximately 3.4% of total supply,” Gautam Chhugani wrote earlier this month.
That amounts to roughly 720,000 tokens — up 160% from the 270,000 held at the end of 2023. Bernstein forecasts that bitcoin will reach $200,000 by year-end.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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