The recent price movements of Bitcoin have been quite volatile, especially with GameStop announcing its intention to include the cryptocurrency in its financial portfolio.
Following a brief surge towards $89,000 during overnight trading, Bitcoin began to decline during US market hours on Wednesday, dropping approximately 3% to around $86,500 by early afternoon. Other leading cryptocurrencies also saw a downturn, with ether (ETH), solana (SOL), and AAVE declining by 3% – 4% in the same timeframe. The CoinDesk 20 Index, which reflects the overall cryptocurrency market, fell by 1.9% within 24 hours.
This drop in cryptocurrency values came simultaneously with a downturn in US equities. The S&P 500 and Nasdaq declined by 0.8% and 1.6%, respectively, reversing most of their early-week gains. Analysts attributed this market behavior to renewed uncertainty surrounding the US debt ceiling and impending tariffs set to take effect on April 2, which seem to have dampened investor confidence.
“Uncertainty around US trade policy and the wider political environment continues to be top of mind,” stated analysts from QCP Capital in a Telegram message. “In the interim, we anticipate ongoing sideways volatility.”
Amid these macroeconomic anxieties, cryptocurrency traders were also keenly observing how the markets would react to GameStop’s announcement.
GameStop’s Bitcoin Treasury Strategy Sparks Market Speculation
GameStop confirmed on Tuesday its plans to dedicate a portion of its $4.8 billion cash reserves to Bitcoin and stablecoins pegged to the US dollar. Although the company did not specify the investment amount or when it would commence, this announcement led to a significant increase in its stock price, with GME shares soaring by 16% during regular trading on Wednesday.
This announcement came after earlier hints from CEO Ryan Cohen about the company’s interest in Bitcoin. He was supported by Matt Cole, CEO of Strive Asset Management—one of GameStop’s ETF stakeholders—who also advocated for a Bitcoin allocation.
There was considerable speculation online regarding the size of GameStop’s potential investment. Anthony Pompliano, founder of Professional Capital Management, indicated that the company would likely not revise its investment policy for a minor allocation. “You only invest the time and effort to amend your investment policy if you plan to allocate a significant amount of your cash to Bitcoin,” Pompliano remarked, noting Cohen’s active engagement with Bitcoin-related content on social media.
Michael Saylor from MicroStrategy also posed a question to his followers about how much Bitcoin GameStop would need to hold to gain credibility within the cryptocurrency community, with many respondents suggesting a minimum of $3 billion.
GameStop to Raise $1.3B in Convertible Debt for Bitcoin and Corporate Needs
Shortly after announcing its Bitcoin treasury strategies, GameStop disclosed plans to issue $1.3 billion in convertible senior notes to support these initiatives. The notes will mature in five years and carry a 0% coupon, with an option for underwriters to acquire an additional $200 million.
The company stated that proceeds from this offering would be used for “general corporate purposes,” including Bitcoin acquisitions as per its new investment policy.
GameStop is now among a growing number of companies—such as MicroStrategy, Semler Scientific, and Riot Platforms—that are utilizing convertible debt to facilitate Bitcoin purchases.
Despite the fundraising announcement, GME shares fell 7% in after-hours trading following Wednesday’s earlier surge. On the other hand, Bitcoin exhibited signs of recovery from its intraday downturn, bouncing back from $86,000 to above $87,000 shortly after the announcement regarding debt issuance.
(Photo by Unsplash)
See also: Sam Altman’s World Network in discussions with Visa on cryptocurrency wallet integration
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