Key Takeaways
- GameStop received a proposal to invest $5 billion in Bitcoin from Strive Asset Management.
- The investment is seen as an opportunity for GameStop to become a major bitcoin treasury player in the gaming sector.
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GameStop CEO Ryan Cohen on Tuesday confirmed that he had received a letter from Matt Cole, CEO of Strive Asset Management, in which Cole proposed the company use its cash reserves to invest in Bitcoin.
The video game retailer held approximately $4.6 billion in cash piles at the end of the third quarter of 2024, according to a December SEC disclosure.
Cole sent the letter to Cohen on Feb. 24, stating that GameStop has a unique opportunity to transform itself by becoming the premier Bitcoin treasury company in the gaming industry.
“We believe this shift can elevate $GME from “meme stock” to gaming-sector leader, driving long-run value for shareholders—including our clients who hold GameStop through our ETFs,” Cole wrote on X.
He argues that Bitcoin will become the new “hurdle rate” for capital deployment, suggesting cash provides negative real returns while Bitcoin serves as an inflation hedge.
The proposal recommends GameStop focus exclusively on Bitcoin while avoiding other crypto assets, and leverage capital markets through at-the-market offerings and convertible debt securities.
Strive Asset Management, co-founded by Vivek Ramaswamy, recently launched the Strive Bitcoin Bond ETF, an investment product designed to provide investors with exposure to Bitcoin through convertible securities, mainly associated with MicroStrategy’s holdings.
The ETF will invest primarily in Bitcoin bonds and other derivatives such as swaps and options, focusing on direct and derivative positions in Bitcoin-linked securities. It will also hold cash in US Treasury securities and potentially invest in other Bitcoin-focused financial instruments.
GameStop explores Bitcoin investment amid retail struggles
The proposal follows a recent CNBC report that GameStop is considering adding Bitcoin and other digital assets to its investment portfolio.
“We recognize GameStop is exploring how to embrace this opportunity, and we believe execution will be critical for long-term success. That’s why we engaged immediately—to encourage not only bold action but also a clear commitment to Bitcoin only,” Strive CEO noted.
The exploration of crypto investments comes as GameStop faces declining sales, with a 20% drop reported in Q3 2024 across both hardware and software segments. The company’s traditional brick-and-mortar business continues to face challenges as digital game downloads gain popularity.
GameStop’s board approved a revised investment policy in January, granting CEO Cohen and his team expanded authority to invest in equities and other assets.
CEO Cohen also met with Strategy’s co-founder Michael Saylor shortly before the report, though sources indicated Saylor is not currently involved in the company’s internal crypto discussions.
GameStop previously explored digital assets through an NFT marketplace launched in July 2022, but scaled back the initiative in early 2024 citing “regulatory uncertainty.” The company also ended its crypto wallet service in late 2023 due to similar regulatory concerns.
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