GameStop + Bitcoin= Peanut Butter + Jelly

I don’t remember the last time I went into a GameStop. In fact, I can’t remember the last time I saw a GameStop. I think I’ve seen more Shakey’s Pizzas in the last 5 years than GameStop locations. And that’s not a healthy sign if you are in the retail business.

I’m not going to go on a long diatribe about why GameStop’s business model is and has been a trainwreck for more than a decade. There’s a reason why over 100% of the shares were sold short. Ironically, such bearishness in the stock proved to be its saving grace.

In a world of reality, GameStop would have been out of business long ago, and we’d add it to the list of dead retail establishments. But they got a second chance. And the (handsomely paid) executive team smartly capitalized on this boon by issuing stock and raising over a billion dollars.

Now they have a bunch of money, a surprisingly strong stock price, and an army of stockholders not quite sophisticated enough to lose their money in memecoins. But it seems like GameStop may get another lease on life via Bitcoin.

GameStop Has To Invest in Bitcoin

Companies purchasing Bitcoin now are still relatively early. Amazon, Apple, and Google haven’t added Bitcoin to their balance sheets yet. If they buy in now, they won’t be the first like Tesla and M̵i̵c̵r̵o̵ ̵Strategy, but they certainly won’t be the last.

And the reality is, what else can GameStop do? Mobile gaming has made the hardware business obsolete and it’s pointless to try running against the wind in a hurricane.

Ryan Cohen, GameStop’s CEO, met with the Bitcoin Whisperer himself, Michael Saylor two days ago. I doubt they were discussing how GameStop could convert into a restaurant, a coffee shop, or a nail establishment, the only retailers still in business.

I feel the multi-billionaire Saylor had an easy pitch for the 39-year-old CEO, Cohen. Maybe Saylor couldn’t get the appointment with Microsoft, but that’s even more reason for GameStop to move forward immediately with a Bitcoin purchase. They can beat Microsoft!

Why Gamestop and Bitcoin are Destined to be Bedfellows

GameStop investors are typically younger than the M̵i̵c̵r̵o̵ ̵Strategy crowd. This is phenomenal because it means that GameStop can copy the M̵i̵c̵r̵o̵ ̵Strategy playbook and further lever Bitcoin with massive amounts of capital.

M̵i̵c̵r̵o̵ ̵Strategy is risky, but imagine the volatility on GameStop options when they make their first Bitcoin purchase. Market makers are going to have so much fun draining these young investors’ inheritances. And it will further strengthen Bitcoin so people with the stomach to hold it will do well.

Meanwhile, the executive team gets to keep their nice salary and stock options and credit themselves as saving the company. It works well for everybody.

Key Takeaways

In another ironic twist, the big winner from GameStop purchasing Bitcoin is Robinhood. The very company that screwed over these young investors will get to double dip as these young speculators re-enter the casino.

As a Bitcoin investor, I look forward to seeing GameStop buy Bitcoin and add it to its balance sheet. I think that, under Saylor’s tutelage, GameStop can do well until the shit hits the fan. Because if another bear market hits, it’s going to be FTX times 10 if these levered corporations fail.

I hope that doesn’t happen. However, it’s important to consider all possibilities. And adding another levered Bitcoin layer may not be in the best interest of Bitcoin. Or, maybe I’m wrong. Perhaps Bitcoin will become too big to fail and M̵i̵c̵r̵o̵ ̵Strategy and GameStops will get bailed out.

Do you think GameStop will buy Bitcoin? If they do purchase Bitcoin, do you think it will help their stock? If you believe GameStop has other options, please share them with me in the comment section.

I appreciate your reading. Please clap, comment, and share this article if you like it.

I own MSTR stock and BTC. This information should not be taken as investment advice. I haven’t been paid to write this article. Digital assets like crypto and NFTs involve risk, so you should always perform due diligence before investing.

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