Why Is GameStop Stock (GME) Crashing after a Bullish Bitcoin Buy?

GameStop (GME) just threw down half a billion dollars on Bitcoin — but Wall Street isn’t applauding. Instead, it dumped the stock. 

Turns out, a massive crypto buy isn’t enough to distract from the bigger question: what’s the actual plan for the business?

GameStop Buys 4,710 BTC — And Gets Slammed With a 10% Drop

On May 28, GameStop confirmed it had bought 4,710 Bitcoin, worth roughly $513 million. It’s the kind of headline that would’ve sparked a meme-fueled frenzy just two years ago. But this time, shares fell nearly 11% to close at $31.21.

This wasn’t some gradual slide — it was a clean break lower. And it happened after the company gave Bitcoin bulls exactly what they wanted. Why? Because this wasn’t about excitement. It was a “sell-the-news” moment in full effect.

Ryan Cohen Makes the Case for Bitcoin — But Investors Aren’t Sold

CEO Ryan Cohen made his case loud and clear from the stage at Bitcoin 2025: “Bitcoin and gold can be hedges against global currency devaluation and systemic risk.”

Cohen even listed reasons why BTC beats gold — portability, verifiability, scarcity, and growth upside. He clearly believes Bitcoin isn’t just digital gold — it’s better. But no matter how strong the argument sounds, the market heard something different: GameStop has no better use for half a billion dollars than parking it in Bitcoin. For many investors, that read like a red flag.

Bitcoin Bet Highlights What GameStop’s Still Missing

Here’s the truth Wall Street is reacting to: Bitcoin may hedge macro risks, but it doesn’t hedge poor fundamentals.

GameStop hasn’t fixed its core business. It’s still a legacy retailer in a shrinking niche, facing declining sales and a pivot strategy that hasn’t fully materialized.

Buying Bitcoin doesn’t change that. If anything, it raises concerning questions: Why now? Where’s the operational growth? Is this a bet on the business — or a distraction?

GameStop isn’t the only one leaning into BTC. Trump Media (DJT) also announced a $2.5 billion Bitcoin treasury plan this week — and its shares dropped 24%. That’s not a coincidence. Wall Street has seen this strategy before — flashy crypto headlines that don’t address revenue, strategy, or execution.

The market message? Bitcoin doesn’t offset weak fundamentals. Not anymore.

Is GameStop a Good Stock to Buy?

Right now, only one Wall Street analyst is officially covering GameStop—and the verdict isn’t glowing. Michael Pachter of Wedbush has tagged GME with a “Moderate Sell” rating and a $13.50 price target, implying a steep 54.59% downside from current levels.

Pachter isn’t exactly buying the Bitcoin pivot. He points out that while the company’s sitting on roughly $10 per share in cash, there’s “no clear plan” for how that money—or the new BTC hoard—is going to revive GameStop’s actual business.

Translation: Buying Bitcoin isn’t a business model. Wonder what Strategy’s (MSTR) Michael Saylor would say to that.