GameStop saw a rise in its stock on Wednesday as investors showed interest in the company once again, particularly after it announced its foray into cryptocurrencies. The video game retailer's shares increased by 12% after revealing plans to invest in bitcoin, a move prompted by the decline in its traditional retail business due to online downloads and e-commerce dominance.

Following in the footsteps of MicroStrategy, GameStop updated its investment policy to include bitcoin as a treasury reserve asset. MicroStrategy is a major holder of bitcoin, with its stocks often reflecting the performance of the digital currency.

This shift in GameStop's investment strategy aligns with the growing attention towards digital assets, supported by U.S. President Donald Trump's recent focus on cryptocurrencies. Analysts note that the stock's surge is more driven by the bitcoin investment than retail operations.

Capital.com analyst Daniela Hathorn anticipates heightened volatility for GameStop's shares due to their association with bitcoin. While bitcoin has experienced a decline from its peak in January to around $88,000, GameStop still managed to double its net income in the fourth quarter through aggressive cost-cutting efforts.

Under CEO Ryan Cohen's leadership, GameStop has closed numerous physical stores to transition towards e-commerce, resulting in a 30% decrease in net sales but a significant boost in net income to $131.3 million for the fourth quarter.