GameStop Stock Hits Restrictions on NYSE as Short Volume Soars 234% Amid Bitcoin Plans

GameStop Stock Faces Short Sale Restrictions as Short Volume Skyrockets

GameStop (GME) has hit a significant milestone, with its stock facing a Short Sale Restriction (SSR) on the New York Stock Exchange (NYSE) after short sales surged by an astounding 234%. This comes amid uncertainty surrounding GameStop's announcement to enter the Bitcoin market, drawing attention from investors and analysts alike.

As per TradingView data, the short sales volume of GameStop’s stock reached 30.85 million shares on March 27, 2025, a dramatic increase in just 24 hours. This spike in short sales triggered the SSR, which is implemented when a stock drops more than 10% from the previous day's closing price. On March 27, GameStop's stock fell 22%, wiping out much of the 12% gain it had seen following its announcement regarding Bitcoin. At the time of publication, GME was trading at $22.09.

Learn more about SSR rules on the NYSE here.

GameStop's Short Sales Near 2021 Short Squeeze Levels

The short sale volume reached levels reminiscent of GameStop’s infamous short squeeze in January 2021, which saw the stock skyrocket after a battle between retail investors and hedge funds. In January 2021, the short sales volume peaked at 33.26 million shares on January 19, prompting massive price volatility.

Malone Wealth president and CEO Kevin Malone highlighted the significant increase in short sales, noting that GameStop traded 50 times more shares than the previous Thursday. He questioned whether this surge was the result of “naked short-selling,” a practice that involves selling shares that have not been borrowed.

GameStop’s Bitcoin Plans Draw Mixed Reactions

The increase in short sales coincided with GameStop’s recent announcement to purchase Bitcoin, a move that some analysts have critiqued. Although GameStop did not specify the amount of Bitcoin it plans to buy, the company revealed a $1.3 billion convertible notes offering after the markets closed on March 26, 2025. Convertible notes allow companies to issue debt that can later be converted into equity, and GameStop has stated the funds will be used for general corporate purposes, including the acquisition of Bitcoin.

However, not all investors are optimistic about GameStop’s new direction. Tom Sosnoff, founder and CEO of Tastylive, suggested that GameStop’s decision to buy Bitcoin felt reminiscent of the “dot-com era,” where companies added “dot-com” to their names to appear tech-savvy without a clear strategy. In an interview with Yahoo Finance on March 27, Sosnoff remarked that GameStop’s Bitcoin plans may not be part of a sustainable business strategy.

Check out Tom Sosnoff’s comments on GameStop’s Bitcoin plan here.

Bret Kenwell, a US investment analyst at eToro, also expressed skepticism, telling Reuters that investors are “not necessarily optimistic on the underlying business” of GameStop.

Convertible Notes Offering Seen as a Factor in Stock Decline

Some analysts believe that the decline in GameStop’s stock price is directly tied to the announcement of its convertible notes offering. Han Akamatsu, a prominent investor, compared GameStop’s situation to that of Strategy (formerly MicroStrategy) in 2021. Akamatsu noted that MicroStrategy saw a dip in stock value following a similar convertible notes offering but later experienced a surge when Bitcoin prices rose significantly. He suggested that if GameStop’s Bitcoin investment or the crypto market itself performs well, the situation could create another “squeeze opportunity” for investors.

Discover more about convertible notes and their impact on stocks here.

Looking Ahead: GameStop’s Future and the Continued Short Squeeze Speculation

Despite the uncertainty surrounding GameStop’s Bitcoin acquisition and the company’s stock volatility, there’s speculation that the stock may follow a similar trajectory to the 2021 short squeeze if the cryptocurrency market experiences significant growth. As the stock continues to battle short interest, GameStop's pivot into crypto remains a key area of focus for both retail and institutional investors alike.

The biggest day of short sales in GameStop's history still belongs to June 3, 2024, when 46.20 million shares were shorted, which coincided with Keith Gill’s return to the stock, armed with $180 million. His involvement in the 2021 short squeeze made him a key figure in the saga.

Read about Keith Gill's role in the GameStop short squeeze here.

As GameStop navigates its entry into the cryptocurrency market, the volatility of its stock and the resurgence of short interest continue to captivate investors. While some see the move as a sign of innovation, others view it as a risky strategy that may not translate into long-term success. For now, all eyes remain on how GameStop will navigate the market and what the future holds for its stock and Bitcoin investment.