GameStop has once again capped its Bitcoin upside by rolling over a covered-call arrangement with Coinbase, preserving $5.8 million in premium income and resetting the strike to $80,000 after the prior contracts expired worthless.
According to a quarterly SEC filing submitted Thursday, GameStop’s earlier batch of Bitcoin-linked options expired unexercised on May 29, leaving the company with the collected premiums. The retailer promptly entered a new set of agreements with Coinbase that largely keeps its Bitcoin pledged under the same framework—but at an $80,000 strike, down from the prior $105,000–$110,000 range.
How the deal works
- The structure is essentially a covered call: GameStop grants Coinbase the right to acquire its Bitcoin if BTC rises above the strike before expiration in exchange for upfront premium income. If the options aren’t exercised, GameStop keeps the premium and retains the pledged coins.
- GameStop previously moved all but one of its 4,709 BTC into this arrangement and disclosed that Coinbase may reuse, sell, or otherwise transfer the pledged coins during the contracts’ lives.
Accounting and balance-sheet effects
- Under the contract and accounting rules disclosed in the filing, the pledged Bitcoin is no longer recorded as a direct digital-asset holding on GameStop’s balance sheet. Instead, the company records a $369.6 million receivable from Coinbase — a figure roughly $58 million below GameStop’s original cost basis for the coins.
Financial takeaways
- The options roll preserved $5.8 million in premium income after the earlier contracts lapsed.
- Despite Bitcoin being central to its treasury play, GameStop reported only about $1 million in gains from digital assets during the quarter.
- Overall, GameStop posted roughly $390 million in net income for the quarter, driven primarily by interest on large cash reserves and an unrealized gain tied to an eBay options position—not by its retail business.
Broader corporate context: eBay bid and strategy
- GameStop also continues to pursue activity around eBay. Last month it submitted an unsolicited, non-binding proposal to buy eBay for $125 per share—an offer valuing eBay at roughly $55.5 billion on an undiluted basis—funded 50% in cash and 50% in GameStop stock.
- GameStop disclosed a roughly 5% economic stake in eBay via derivatives and common stock, and said an acquisition could generate about $2 billion in annual cost savings within 12 months through cuts to sales & marketing, product development, and admin functions.
Market backdrop
- At the end of the reported quarter (May 2), Bitcoin was trading close to the new $80,000 strike, which would have increased the theoretical value of the options. More recently, BTC was near $63,500 on Friday—about 34% below its yearly high and roughly $43,000 below GameStop’s average purchase price.
- Spot Bitcoin ETFs saw roughly $2.1 billion in net outflows through June, according to market data cited in the filing.
Bottom line: GameStop’s move preserves short-term income and keeps the company exposed to upside only above an $80,000 strike while shifting the pledged BTC off its direct holdings on the balance sheet—a conservative income-first play that leaves meaningful upside to Coinbase if Bitcoin rallies past the reset level.
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