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Shares of GameStop rose in the news that the company is launching a non-fungal token (NFT) market.
It was only a matter of time before the turbocharged world of meme-stock and crypto trading collided, in a speculative madness.
On Thursday night, GameStop Corp., which became the flagship of the tumultuous year of retail investment in 2021, is entering the non-fungus token business, with shares rising more than 20% after hours before giving up some land. Shares rose about 6% to $ 138.50 at 10:45 a.m. Friday in New York City. The jump was back in late November.
NFT was the hottest product in the world of cryptography last year, when the prices of some digital artwork rose by millions of dollars and celebrities and athletes approached the asset class. GameStop’s flirtation with cryptography AMC Entertainment Holdings Inc. Following in the footsteps of Reddit’s most popular crowd, he announced in November that he was considering issuing his own cryptocurrency.
Entering the NFT trade would mark President Ryan Cohen’s latest pivot, whose push to reinvent the brick-and-mortar video game vendor into its first digital retailer sparked a flurry of equities last year, causing huge losses for hedge funds. the shares were short.
“The market loves the decision, the struggling company has bought some time by putting the NFTs hanging in front of investors,” said Tokyo gaming industry analyst Serkan Toto. “However, I am very skeptical that GameStop can do it on its own. The company certainly needs partners to compete with the likes of OpenSea and to partner with video game companies. ”
GameStop’s NFT strategy, first reported by the Wall Street Journal, talks to crypto and blockchain operators about which tokens would be accepted in their market, as well as the potential funding set-up of $ 100 million each to invest in NFT content creators. and game studios.
NFT’s largest marketplace, OpenSea, valued $ 13.3 trillion this week in its latest fundraising round. Last year saw a burst of sales, with monthly volume peaking at $ 3.4 billion in August, up from $ 96.7 billion in February, according to Dune Analytics. The company earns money by making a 2.5% reduction on each transaction.
Following the success of OpenSea, many other NFT markets have sprung up in recent months with the aim of attracting users. GameStop already has millions of loyal players who can target its market.
The cryptocurrency stock was on display this week at Square Enix Holdings Co. shares jumped 7.5% after its president’s New Year’s letter set out plans to develop incentives for players based on metaverse, blockchain and NFT. This also showed the contrast between the market and the public reaction, with the developer, whose title includes the iconic Final Fantasy franchise, for the efforts of players and industry observers to make money.
(Updates sharing.)
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