​Why is the GameStop NFT platform significant?

GameStop, a company that benefited from the popular WallStreetBets movement in early 2021, recently announced that they will be launching an NFT marketplace. While there’s still a lack of concrete information on what this might lead to, it promises to be an alternative to OpenSea and could revolutionize the digital gaming economy.

In 2020, GameStop was on the brink of collapse and expected to go bankrupt sometime in the next few years. Their business is largely focused on selling physical games and gaming merchandise, but due to the proliferation of online shopping and video game consoles, they have opted to allow players to download their games rather than buy them from stores and play them on discs.

In fact, their business is on the brink of failure, so much so that hedge funds and investors are shorting GameStop’s stock, meaning they’re betting its price will drop. Users of the WallStreetBets Reddit forum noticed this trend and saw a ton of shorts on GameStop. To make money, thousands of WSB users bought GME at the same time, causing the price to rise and creating a “short squeeze”, where people who were short the stock were squeezed out of their positions and had to buy the stock to cover their losses. This caused GME to go from a few dozen dollars to more than $400 in a few weeks, with a valuation of over $20 billion. After learning from past mistakes, they were determined to turn to the digital space.

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Part of this strategy includes forays into blockchain, NFTs and Web 3.0. After months of hiring, GameStop officially announced their plans to create an NFT marketplace on January 7, sending its shares up nearly 20%. They also have plans for $100 million to acquire cryptocurrency companies and partner with game developers. Bittui previously reported that their official plan includes creating an “online center” to trade game-related assets and NFTs.

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Although it has not been confirmed what blockchain GameStop will be built on, it is widely believed that Loopring’s layer 2 solution will be used to create a high-speed, low-cost transaction processing environment. Neither side has confirmed or denied the rumors, but sources suggest a collaboration is in the works. This may explain some of the explosive price action of the LRC token over the past few months, as the partnership with GameStop will surely bring more attention to any blockchain project.

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Currently, there is no secondary market for digital video games. Once someone buys a game, it is permanently tied to their account and cannot be traded or resold. GameStop could change that by turning digital games into NFTs and allowing users to resell and trade them on exchanges. This will create a new multi-billion dollar industry in the secondary digital game market that can help game publishers and players make more money. Publishers can earn royalties from every game sold on the secondary market, resulting in sales they otherwise wouldn’t have, and players can make money by selling games they don’t want to play anymore.

If GameStop’s market moves in this direction, it will be an unprecedented and unique use of NFTs that could propel it to new levels of adoption and potentially make GameStop a Web 3.0 gaming powerhouse.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/%e2%80%8bwhy-is-the-gamestop-nft-platform-significant/
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