Why GameStop represents the convergence of meme stocks and crypto mania

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It was just a matter of time before the turbocharged worlds of meme-stock and crypto trading collided in a burst of speculative frenzy. And Grapevine-based...

The Grapevine-based video game retailer already has a stable of millions of loyal gamer fans whom it can direct into its own NFT marketplace.It was just a matter of time before the turbocharged worlds of meme-stock and crypto trading collided in a burst of speculative frenzy.

And Grapevine-based GameStop Corp., the company that became emblematic of 2021′s turbulent retail investing, finds itself at the center of that convergence.sent the stock soaring more than 20% after hours before giving back some ground on Friday. Shares were up over 7% to close Friday at $140.62. The jump followed a sharp retreat since late November.

NFTs emerged as the hottest commodity of the crypto universe last year as prices for some digital artworks spiraled into the millions of dollars, and celebrities and athletes flocked to the asset class. GameStop’s flirtation with crypto follows that of fellow Reddit-crowd darling AMC Entertainment Holdings Inc., which announced in November that it’s contemplating issuing its own cryptocurrency.

Getting into the NFT trade would mark the latest pivot for GameStop chairman Ryan Cohen, whose push to reinvent the brick-and-mortar video games seller into a digital-first retailer sparked a fervor for the stock last year, triggering large losses for hedge funds who were short the shares. “The market loves the decision, the struggling company has bought some time by dangling NFTs in front of investors,” Tokyo-based games industry analyst Serkan Toto said. “However, I am very skeptical if GameStop can make it on its own. The company definitely needs partners to compete with the likes of OpenSea and get video game companies to cooperate.”

 

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