GameStop (GME) shares are down more than 7% on Wednesday after the world’s largest video game retailer announced its first investment in Bitcoin (BTCUSD).  

The gaming merchandise specialist has spent some $500 million to load up on 4,710 BTC in total, its press release revealed on Wednesday. 

GameStop stock has been in a sharp uptrend over the past two months. So, despite today’s plunge, it’s up roughly 50% versus its year-to-date low. 

Why Is GameStop Stock Slipping on Wednesday?

Investors are bailing on GME shares perhaps because the retailer’s crypto strategy seemingly differs from the one that’s generated exceptional returns for MicroStrategy (MSTR).

MSTR’s immensely successful crypto strategy was built over time. The business intelligence firm accumulated BTC at lower prices now strategically adds to its position.

In contrast, GameStop is entering the Bitcoin market at an already elevated price of about $107,000, which raises concerns that it may fail to benefit from the pivot as much as MicroStrategy did. 

Additionally, the inherent volatility of the crypto market may be making investors nervous, adding to the decline in the GameStop stock price on Wednesday.   

Should You Buy GME Shares at Current Levels?

GameStop stock remains a high-risk investment for the back half of this year as it’s majority owned by retail investors, which makes it relatively more susceptible to volatility. 

Plus, the NYSE-listed firm is currently going for about 70 times its estimated earnings for 2025. 

Top it off with continued weakness in its core retail business amidst a global shift to digital gaming – and you have a business that’s struggling with a lack of clear strategy for future growth. 

Wall Street’s View on GameStop

GME shares are not particularly popular among Wall Street analyst. 

The only analyst that covers GameStop has a “Strong Sell” rating on it with a price target of $13.50, which translates to potential downside of more than 50% from current levels.