- GameStop jumped 20% in pre-market trading after a report said it forecast an NFT market.
- The Wall Street Journal also reported that GME is on the verge of signing two crypto partnerships.
- The Reddit WallStreetBets forum rejoiced, and many users expected a repeat of last year’s memes stock mania.
GameStop share climbed 20% in pre-market trading after a report said the game retailer planned to create a market for non-fungible tokens, or NFTs, and was set to seal partnerships from cryptocurrency.
The company has hired more than 20 people to oversee the NFT unit as it tries to turn around its business, The Wall Street Journal reported Thursday, citing people familiar with its plans.
GameStop (GME ticker) jumped 19.82% in pre-market trading to $ 157 on Friday, after climbing to 29% in after-hours trading.
The move sparked huge excitement on the WallStreetBets Reddit forum. Traders sent it shares of GameStop – one of the original “memes stocks” – which skyrocketed in January 2021, hitting hedge funds that had bet against the company.
“GME is back on the boyz menu,” a forum post on the subject read on Friday.
“I wasn’t there last January, and I’m sure nothing’s missing in January,” one user wrote. “Get back into the game, roll the dice guys,” said another.
GameStop’s move to NFTs would bring together two streams that dominated retail investing in 2021: memes stocks and crypto-mania.
Non-fungible tokens – crypto collectibles or artwork written on the blockchain – gained popularity last year, becoming a $ 40 billion market. One NFT, a work by artist Beeple, sold for a record $ 69 million in March.
Other memes stock names such as AMC have also been investigating crypto projects, likely in an attempt to appeal to retail traders who have become so in love with their businesses last year.
Read more: Hobbyist Traders, Reddit Monkeys, and Memes Lords beat Wall Street for 2 years. But in 2022 … the bigwigs will retaliate.
The WSJ reported that GameStop is building an online marketplace to buy and sell video game-focused NFTs, such as weapons and avatar outfits. The Grapevine, Texas-based company is also on the cusp of making deals with two digital asset partners to invest in crypto games, he said.
While irony and nostalgia are the roots of much of the 2021 memes stock mania, many retail and institutional investors see potential in GameStop, given the popularity of the games.
Activist investor Ryan Cohen took over the presidency last year and tried to transform the company into a more modern, tech-savvy company.
Nonetheless, GameStop reported a loss of $ 105 million in the third quarter. Its stock has fallen by about 30% in the past six months.
Still, the company’s poor financial performance might not be enough to deter retail investors when trading opens on Friday. “I’m getting the right kind of flashbacks from a year ago,” posted one WallStreetBets user.
GameStop did not respond to a request for comment.