GameStop Bitcoin Strategy: Company Uses BTC Holdings for Covered Calls, SEC Filing Reveals

• Stacey George
• March 27, 2026
• Business
• 0 Comments

GameStop pledged 4,709 of its 4,710 Bitcoin to Coinbase Credit as collateral for a covered call options strategy, generating just $2.3 million in unrealized gains against a total digital asset loss of $131.6 million in fiscal 2025, according to the company’s Form 10-K filed with the SEC on March 24, 2026.

The filing covers GameStop’s fiscal year ended January 31, 2026, and represents the first public disclosure of the retailer’s options-based approach to its Bitcoin treasury. GameStop purchased 4,710 BTC in May 2025 for approximately $500 million, paying between $106,000 and $107,900 per coin.

Rather than simply holding the position, GameStop entered a Collateral Agreement with Coinbase Credit, Inc. and sold over-the-counter covered call options against 4,709 BTC. The strike prices ranged from $105,000 to $110,000 per coin, with contract maturities running through March 27, 2026.

What GameStop’s SEC Filing Says About Its Bitcoin Options Strategy

A covered call is an options strategy where the holder of an asset sells a contract giving the buyer the right to purchase that asset at a set price (the strike) by a set date. In exchange, the seller collects a premium. The trade-off: if the asset’s price rises above the strike, the seller must part with it at the lower agreed price, capping their upside.

In GameStop’s case, the company pledged 99.98% of its Bitcoin holdings to Coinbase Credit as collateral for the strategy. Only one Bitcoin remained directly on GameStop’s balance sheet outside the arrangement.

Critically, the collateral agreement grants Coinbase Credit the right to rehypothecate, commingle, or unilaterally sell the pledged Bitcoin. Under U.S. GAAP, those rehypothecation rights forced GameStop to derecognize the 4,709 BTC from its balance sheet entirely, replacing them with a “digital assets receivable.”

That receivable was initially recorded at $428 million upon derecognition but declined to $368.3 million as of January 31, 2026, reflecting Bitcoin’s price decline over the period. The accounting treatment also dropped GameStop’s corporate Bitcoin ranking from approximately 21st globally to 190th, since the pledged coins no longer count as directly held assets.

On or around January 16, 2026, GameStop transferred its entire Bitcoin stack to Coinbase Prime, a move that sparked widespread liquidation rumors at the time. The 10-K clarified those rumors were unfounded; the transfer was part of the collateral arrangement, not a sale.

Why the Covered Call Yield Barely Dented GameStop’s BTC Losses

The numbers tell a stark story. GameStop’s total fiscal 2025 loss on digital assets and related receivables reached $131.6 million, representing 3.6% of net sales. That figure breaks down into a $71.8 million realized loss upon derecognition and a $59.7 million unrealized loss on the receivable.

Against that $131.6 million loss, the covered call options produced a $2.3 million unrealized gain, partially offset by a $0.7 million derivative liability. The net options benefit offset less than 2% of the total loss.

The strategy differs sharply from how other public companies manage their Bitcoin treasuries. Firms like MicroStrategy (now Strategy), Metaplanet, Tesla, and Block all hold BTC as a passive balance sheet reserve without deploying yield-generation strategies against those positions. GameStop’s approach, pledging nearly all holdings as collateral and writing OTC calls, introduces counterparty and rehypothecation risk that simpler treasury strategies avoid.

With Bitcoin trading near $69,984 as of March 26, 2026, well below the $105,000-$110,000 strike range, the calls expired out of the money. GameStop kept its Bitcoin and the option premiums, but the underlying position lost significant value from its $106,000-$107,900 purchase price.

What GameStop’s BTC Options Move Means for Investors

The disclosure raises questions about GameStop’s long-term commitment to its Bitcoin strategy. CEO Ryan Cohen publicly stated that a new consumer megadeal target is “way more compelling than bitcoin,” signaling a potential pivot away from the crypto treasury approach.

Wall Street analysts maintain a consensus “Hold” rating on GME with a target price of $18.25, reflecting skepticism about execution risk from Cohen’s acquisition plans. The covered call disclosure adds a new dimension: GameStop is not just a Bitcoin holder, it is actively trading derivatives against its position, a posture that carries additional complexity and risk.

The strategy has nonetheless attracted institutional attention. Bitwise has launched a GameStop Covered Call ETF (ticker: IGME), suggesting at least some market appetite for the yield angle. The approach also raises novel accounting questions, as the GAAP treatment of crypto collateral arrangements lacks established precedent and may invite further SEC scrutiny.

GameStop’s filing also discloses specific risk factors tied to the arrangement: counterparty credit exposure to Coinbase, the risk that rehypothecation could obscure legal title to the pledged Bitcoin, and broader regulatory uncertainty around crypto asset accounting.

The Form 10-K filing lands during a period of sustained market anxiety. The Fear and Greed Index has sat at “Extreme Fear” for 46 consecutive days, the longest unbroken streak since the FTX collapse in November 2022. Whether GameStop renews its covered call strategy after the current contracts mature on March 27, 2026, or pivots entirely toward Cohen’s consumer megadeal vision, remains an open question with direct implications for its $368 million digital assets receivable.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.