GameStop (GME) shares rise 31% after hiring a team to develop the company's NFT platform
GameStop (GME) shares rise 31% after hiring a team to develop the company's NFT platform

Leading video game publishers have begun to fully invest in blockchain-derived applications. After Ubisoft, it's GameStop's turn to take action by hiring more than 20 people who will be responsible for developing its NFT platform. The announcement of the news was well received on the stock markets. The company's shares jumped by 31%.

A marketplace dedicated to video game NFTs    

For nearly a year, rumors have been swirling that GameStop will enter the NFT sphere. In April 2021, a job posting on the company's website notified that it was looking for an analyst with knowledge of crypto, blockchain and NFT. A month later, the company confirmed that it was looking for exceptional engineers, designers, gamers, marketers and community leaders to participate in an Ethereum NFT project.

On the morning of January 06, the Wall Street Journal revealed that GameStop has just created a new unit of over 20 people to build its NFT platform. This will allow customers to buy, sell and trade NFTs of video game items. This includes clothing and weapons for players' avatars. In response to the announcement, GameStop (GME) stock jumped 31 percent in trading to $170. This is its highest price in nearly a month.

A risky bet

A year ago, Reddit-based traders had already pushed GME's stock price up $20 to $483 by promoting it as a meme stock. The company has since come down from those highs, but has taken advantage of the increased interest and capital to innovate. The current breakthrough in the stock market should also provide GameStop with the cash to fund its new project. However, the company could face a major challenge in the face of many gamers' antipathy towards NFTs.

When Ubisoft launched its NFT platform a month ago, it triggered a lot of discontent among its gaming community. They claimed that blockchain was a threat to the environment and to video games. Some of them still had in mind the exponential increase in the price of graphics cards that are also used by cryptocurrency miners. Square Enix also sparked a revolt from its community by recently announcing its intention to get into blockchain and NFTs.

These events should not deter GameStop, however, for whom foraying into NFTs seems essential. Indeed, the company hopes to leverage this $40+ billion market to reverse several years of losses.

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Nathan George

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