GameStop Bought Bitcoin, Then Handed Almost All of It to Coinbase
When GameStop announced it was buying Bitcoin last year, the narrative wrote itself. The meme stock company was going the Strategy route.
When GameStop announced it was buying Bitcoin last year, the narrative wrote itself. The meme stock company was going the Strategy route, building a treasury position to ride the wave. What got buried in the filing was what happened next.
According to GameStop’s latest annual report, the company pledged 4,709 of its 4,710 Bitcoin to Coinbase as collateral for an options trading strategy. That is 99.9% of the position, handed to a third party almost immediately after spending $500 million to buy it. The arrangement is a covered call, meaning GameStop collects a premium upfront but gives up any gains above $105,000. If Bitcoin runs past that level, the profit goes to the other side of the trade.
The structure is not illegal or even unusual in traditional finance. Covered calls are common. What makes this worth examining is the gap between the stated intention and the execution. A company that framed its Bitcoin purchase as a long-term treasury conviction trade turned around and capped its upside at a specific price the following month. Those two things do not sit easily together.
There is another layer that received almost no attention. The filing notes that the pledged collateral can be reused within Coinbase’s financial framework, a practice known as rehypothecation, where a custodian deploys client assets for its own purposes. GameStop retains formal ownership on paper, but the Bitcoin is functionally working inside someone else’s operation. That is a meaningful departure from the self-custody ethos that tends to accompany genuine Bitcoin treasury strategies.
The company also reported a $131.6 million loss on its digital assets for the full fiscal year, reflecting the movement in Bitcoin’s price since the purchase. Overall net income came in at $418.4 million, up sharply year over year, though revenue fell 25%.
For institutional investors, the takeaway is straightforward. The headline and the details are telling two different stories.
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