GameStop (GME) lost 25% in market value on Thursday following an announcement declaring their decision to invest in bitcoin (BTC) as a treasury reserve asset. The stock dropped to $21.01 per share and sustained its weakest point since October despite losing 28% of its value from Wednesday’s $29.94 levels.
The stock price of GameStop dropped by 25% when the company made its late Wednesday statement about raising $1.3 billion for its bitcoin purchase plan. When crypto supporters first reacted positively to the news about BTC finance terms, their enthusiasm soon faded as more investors examined the terms closely.
GameStop (GME) Shareholders Dump Stock Over Bitcoin Strategy
Market researchers observe that present GameStop stockholders do not like the stock purchase which leads to a change in ownership. Current shareholders oppose this plan, which causes a major ownership shift, Louis Liu stated in an X post.
The pricing period for convertibles occurred at the wrong moment and caused more investors to sell. Research professionals believe stockholders who want to buy the convertible bonds sold or borrowed GME shares because they expect the deal to happen. MicroStrategy (MSTR) and Semler Scientific (SMLR) stock prices experienced lower values when they offered convertible notes.
GameStop $GME is down 20% since it announced its Bitcoin purchasing plan.
Many existing shareholders dislike the move, so a switch is happening with large volume.
The next logical step for Ryan Cohen is to stick with the plan and exceed our expectations with over $4B purchase.
— Louis (@louishliu) March 27, 2025
GameStop Valuation vs. MicroStrategy’s Bitcoin Strategy
During his coverage of GME, Wedbush analyst Michael Pachter shows hesitancy toward GME’s business success. Pachter expects GameStop’s stock price to decrease before the release of the convert because investors who purchase it must accept the zero coupon and stick with the meme trend for five years.
He found important contrasts between how GameStop (GME) handles its operations versus MicroStrategy’s approach to buying Bitcoin out of corporate capital. He affirmed that MicroStrategy sells for less than its bitcoin holdings while GameStop sells for higher than its cash amounts. Our analysis shows the new issue will unlikely succeed.
GameStop Joins Wall Street’s Bitcoin Trend
Wall Street companies keep adding to their list that converts cash into bitcoin as GameStop now joins them. Under leadership from Michael Saylor as CEO MicroStrategy initiated the corporate bitcoin buying trend.
Other businesses follow the lead of successful companies when US policymakers seek to establish digital asset development at home through their pro-bits initiatives. However, the strategy remains polarizing. Although Saylor promotes bitcoin as protection during rising prices and safe investment storage many experts believe these methods bring dangerous results.
Peter Schiff Criticizes GameStop’s Bitcoin Move
The famous bitcoin skeptic Peter Schiff reacted to the GameStop news quickly. Schiff believes investing in Bitcoin through GameStop stock acquisitions won’t deliver a profitable outcome since GME stock lost all yesterday’s Bitcoin-related gains.
The stock price has declined by 2 percent during back-to-back trading days. Smarter traders start selling Bitcoin since they understand buying Bitcoin costs will not create sustainable earnings. The next few weeks will show if GameStop’s decision to enter the Bitcoin market will provide long-term benefits or if it will become another risky phase in the company’s past.
$GME has lost all of yesterday's Bitcoin-inspired 15% gain. Shares are now down 2% over the two days combined. Now that all the fools have already rushed in, smarter investors are selling as they realize that wasting cash buying Bitcoin is not a viable long-term business model.
— Peter Schiff (@PeterSchiff) March 27, 2025
Conclusion
GameStop’s Bitcoin investment program received both enthusiasm and criticism yet investors reacted extremely fast against the company. Experts and investors criticize the move while stock prices drop which makes the future of this company remain unpredictable. The market will test if this step will lead to growth or fail as another company mistake in upcoming weeks.
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FAQs
1. Why did GameStop’s stock drop?
Investors reacted negatively to its $1.3 billion convertible note plan, leading to a sell-off.
2. How does GameStop’s Bitcoin move compare to MicroStrategy’s?
GameStop (GME) trades above its cash reserves, while MicroStrategy’s value aligns more closely with its Bitcoin holdings.
3. What do experts think about GameStop’s Bitcoin strategy?
Some see potential, but critics call it risky and unsustainable.
Glossary of Key Terms
GameStop (GME) – A video game retailer known for its meme stock status.
Treasury Reserve Asset – A financial asset held by companies for long-term stability.
Convertible Note – A type of bond that can be converted into company stock.
Sell-Off – A rapid decline in stock price due to heavy selling.
MicroStrategy (MSTR) – A company that holds Bitcoin as a corporate reserve asset.
Meme Stock – A stock that gains popularity through online hype rather than fundamentals.
References
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