The post GameStop To Raise $1.3 Billion Funds for Crypto Strategy, Stock Dips by 8% appeared first on Coinpedia Fintech News
GameStop has announced plans to raise up to $1.3 billion through convertible debt to boost its Bitcoin holdings. This comes just a day after the company revealed its Bitcoin (BTC) treasury strategy.
Gamestop To Raise $1.3B Through Convertible Notes
The company plans to issue $1.3 billion in convertible senior notes, targeting qualified institutional buyers, with a five-year maturity. It also granted the initial purchasers a 13-day option to buy up to an additional $200 million in notes, bringing the potential total raise to $1.5 billion.
The notes will carry a 0% coupon and will mature on April 1, 2030, unless converted, redeemed, or repurchased earlier. GameStop plans to use the funds raised from the offering for general corporate purposes, including buying bitcoin in line with its Investment Policy.
GME Follows MSTR’s Strategy
With this move, GameStop joins companies like Michael Saylor’s MicroStrategy (MSTR), Semler Scientific (SMLR), Marathon Digital (MARA), and Riot Platforms (RIOT), which have also issued convertible debt to fund bitcoin purchases. Michael Saylor initiated a poll on X, asking how much bitcoin GameStop needs to buy to gain respect from Bitcoiners.
GME Stock Dips 8%
However, GameStop (GME) stock dropped over 8% in after-hours trading Wednesday after the company revealed plans to raise funds for Bitcoin. This follows a 12% surge in GameStop shares just a day earlier when the company announced that its board had unanimously approved adding Bitcoin to its treasury reserve assets.
Concerns about potential share dilution could have led to the drop. However, like MicroStrategy’s Bitcoin strategy boosted MSTR, GameStop’s move could drive long-term growth for its stock. Bitcoin has bounced back from its earlier lows, rising to $87,000 after briefly dipping to $86,000.
GameStop’s planned Bitcoin investment follows reports from CNBC a month earlier that the company was exploring cryptocurrency. The interest in crypto was further fueled by CEO Ryan Cohen’s post with MicroStrategy’s Michael Saylor, who holds over 447,000 Bitcoins.
Wall Street Skeptical Over The Move
While MicroStrategy’s Bitcoin bet has boosted its stock by 84% over the past year, Wall Street remains skeptical about GameStop’s move. Investors are unsure if the video game retailer’s Bitcoin investment will spark a similar surge in its stock price.