GameStop Is Killing Its NFT Wallet and Blames 'Regulatory Uncertainty'

Crypto Breaking News

Aug 1

Video game retailer GameStop made a splashy entrance into the NFT space, launching its own marketplace with big plans to support crypto games. But as the NFT market has lost steam, GameStop has pulled back—and soon it'll end support for its own crypto wallet.

GameStop cited the "regulatory uncertainty of the crypto space" for the move—an increasingly familiar explanation for the drawdown or cancelation of a digital assets initiative. The news was revealed today via a pop-up message on its own NFT marketplace.

Support for the wallet—via both a Chrome web browser extension and iOS mobile app—will cease on November 1. The retailer advises users to ensure that they've backed up their wallet's secret passphrase by October 1, ahead of the shutdown. The wallet was originally launched in May 2022.

GameStop's message alludes to recent developments in the crypto industry, particularly an increase in enforcement actions by the United States Securities and Exchange Commission (SEC) under the leadership of Chair Gary Gensler. The SEC has filed suit against major exchanges Coinbase and Binance in recent months, along with other companies and projects.

GameStop's latest move comes almost two months after the firm fired CEO Matt Furlong, who had served in the role during the launch of the wallet and marketplace, as well as the firm's partnership with Ethereum scaling network Immutable X. That deal included a $100 million incentives fund for developers building on the network.

But before his ouster, Furlong himself had already signaled that GameStop was moving on from its fascination with NFTs and crypto, saying in a December 2022 earnings call that GameStop "will not risk meaningful stockholder capital" in the crypto industry, according to gaming publication GameSpot.

GameStop, which still operates over 4,400 physical stores worldwide as of January, has faced numerous rounds of layoffs in recent years as the video game industry shifts increasingly toward digital delivery. Furthermore, the firm has seen up-and-down swings due in part to the "meme stock" craze of early 2021, which sent the beleaguered retailer's stock price soaring at times.

Crypto wallet engineers were reportedly among the layoffs in December 2022, at the same time that Furlong said that GameStop was shifting its focus away from the NFT space.