Bitcoin is back on the menu for Big Business.
What happened: Perennial meme stock and video game retailer (at least we think it still is) GameStop revealed that it had purchased 4,710 bitcoins, likely costing over US$512 million.
- It’s the second notable instance of corporate bitcoin hoarding this week, with Donald Trump’s media company tapping investors for $2.5 billion to establish a bitcoin reserve.
Big picture: Bitcoin prices have rallied recently thanks to demand for alternative stores of value and the anticipation of crypto-friendly policies from the White House. This has led to a corporate buying spree, as companies look to diversify assets or become crypto brokers.
- At the start of April, there were 89 publicly listed companies with bitcoin holdings. That number has since risen to 114, according to BitcoinTreasuries.net.
Why it matters: This purchasing spree could mark the rise of more companies becoming issuers of bitcoin treasuries — the logic being that investors want to reap the rewards of the crypto boom without the risky exposure of holding the actual assets.
- This business model was pioneered by Strategy, a run-of-the-mill software company that pivoted in 2020 and is now the world’s largest corporate holder of bitcoin.
Yes, but: Why any rational investor would see GameStop as a reliable broker for anything remains to be seen. Maybe that’s why its shares plummeted by ~10.9% on the day.—QH