GameStop is looking to increase their presence in the digital assets space by giving their customers the opportunity to access FTX’s community and marketplace. The partnership is not limited to ecommerce and marketing initiatives, as GameStop will be distributing FTX gift cards in some stores, being the preferred retail partner for FTX US.
In May 2022, GameStop announced the launch of a digital wallet that allows its users to manage and trade cryptocurrencies and non-fungible tokens (NFTs) across decentralised apps.
In 2021, GameStop raised USD 551 million through equity offering to help boost their ecommerce strategy, having their shares value in extended trading increase by 15%. Following a retail investors’ push to increase the price of heavily shorted stocks, GameStop’s stock surged more than 850%, with shares being sold at an average price of USD 157.43.
FTX US received a series A funding of USD 400 million in January 2022 aimed at expanding their presence as a cryptocurrency exchange platform.
In January 2021, GameStop’s stock increased by 1,500 percent, following a short squeeze organised by retail investors, after Citron Research had predicted that GameStop’s stock value would decrease. Over the course of two weeks, the stock price of GameStop rocketed, with an all-time high of USD 483 reached on January 28, as opposed to the initial price it had at the beginning of the month – USD 17.25. On the same day, GameStop shares were deemed ‘failed-to-deliver’, as trading platform Robinhood halted purchases on GameStop shares, amongst other stocks that were deemed volatile.
Other trading platforms followed Robinhood and imposed restrictions as well, and as of February 2021, GameStop shares decreased 60% in value, a decrease believed to be affected by the limitation imposed on purchasing multiple shares at once. Robinhood announced short-after that the restrictions had been raised.
GameStop has since overhauled its management to increase their ecommerce capabilities, due to the shift to online shopping that followed the Covid-19 pandemic. Partnerships such as the one with FTX also follow an effort to increase GameStop’s presence in the cryptocurrency space.
As of September 2022, smaller than expected loss in quarterly shares was reported by GameStop, and, following the volatility from the previous year, the company’s shares had been trading at a value of USD 26.56, as reported by Reuters.
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