GameStop, a well-known video game retailer, has decided to stop operating its cryptocurrency wallet, which was launched in May 2022.
The company cited “regulatory uncertainty of the crypto space” as the primary reason behind this move. This decision comes as the United States Securities and Exchange Commission (SEC) has increased its enforcement actions under Chair Gary Gensler’s leadership, leading to concerns and hesitations in the crypto industry.
GameStop’s Web3 Wallet Halted
The announcement of the wallet’s discontinuation was made through a pop-up message on the company’s NFT marketplace. The web3 wallet, accessible via Chrome web browser extension and iOS mobile app, will officially cease support on November 1. To ensure their funds’ safety, users are urged to back up their wallet’s secret passphrase by October 1.
Pushing for NFTs Despite Gamer’s Lack of Interest
During the tenure of CEO Matt Furlong, GameStop launched the wallet and marketplace along with a partnership with Ethereum scaling network Immutable X, featuring a $100 million incentives fund for developers. However, Furlong had already indicated the company’s shift away from NFTs and crypto during a December 2022 earnings call, stating that they would not risk significant stockholder capital in the crypto industry.
Not an Easy Time for GameStop and NFT Gaming
Aside from the challenges posed by NFTs and crypto, GameStop is facing other difficulties. With over 4,400 physical stores globally, the company has had to deal with multiple rounds of layoffs due to the gaming industry’s transition towards digital delivery. Although the “meme stock” craze in early 2021 brought some respite with a surge in stock prices, it wasn’t sufficient to resolve all of their challenges.
GameStop’s decision to discontinue its crypto wallet reflects the ongoing uncertainty and challenges in the crypto industry. Regulatory actions by the SEC have prompted companies to reconsider their involvement in digital asset initiatives. As GameStop moves away from NFTs and crypto, other gaming companies and crypto projects may also find themselves reevaluating their strategies in light of the changing regulatory landscape.