GameStop Ditching Crypto as Q3 Loss Hits $95M

Although the gaming company has taken steps to reduce its exposure to cryptocurrency activities, it appears to be continuing to make progress with initiatives related to non-fungible tokens (NFTs) and blockchain technology.

After posting a net loss of $94.7 million during the third quarter and laying off workers in its digital assets section, game retailer GameStop has announced that it will no longer focus any efforts on cryptocurrencies.

GameStop CEO Matt Furlong stated in an earnings call on Dec. 7 that the company has “proactively limited exposure to cryptocurrency” over the course of the past year and “does not currently hold a significant amount of any token.” .

The firm said earlier this year that it was investigating crypto, non-fungible tokens (NFTs), and Web3 applications as potential avenues for development. The company described these areas as “increasingly important for the gamers of the future.”

Going forward, GameStop will place a greater emphasis on collectibles, used game systems, and previously owned things.

In a filing with the Securities and Exchange Commission on December 7, the company stated that it “is also seeking and plans to[s] to continue pursuing other business and strategic initiatives associated with digital assets and blockchain technology.” These statements give the impression that the company is still moving forward with its plans to make moves in the non-fiat currency space.

Following the release of a public beta in July, GameStop released a number of Web3-related products to the market, the most recent of which was its NFT marketplace, which went live on October 31 on ImmutableX, a blockchain. layer 2 of Ethereum. This came after GameStop pushed a number of other Web3-related products.

Earlier, in May, the firm unveiled a beta version of its self-custodial cryptocurrency wallet, and in March, it unveiled a test version of its NFT marketplace on Loopring.

Losses GameStop incurred during the third quarter were down marginally compared to the second quarter, which had losses of $108.7 million.

Additionally, this is a year-over-year gain for GameStop, which reported a loss of $105.4 million in the third quarter of the prior fiscal year.

The crypto section reportedly saw staff layoffs.

As verified by Furlong on the earnings call, GameStop made its third round of layoffs for 2022 on Dec. 5, laying off several employees as a result.

Furlong did not clarify where most of the personnel losses were concentrated; Previous reports claimed that the team working on the company’s blockchain and NFT initiatives were the most affected; however, Furlong did not provide this clarification.

A former iOS and blockchain programmer named Brandon Jenniges commented on his blog that he “had a great day diving deep into Ethereum and learning about a lot of new things in the crypto industry.”

In July, the firm fired several employees of its dedicated video game magazine, Game Informer, including its chief financial officer, Michael Recupero, and many other staff members.

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