GameStop to cease its cryptocurrency wallet service due to high regulatory uncertainty.

The long-established U.S. game retailer GameStop has announced that it will stop supporting its own cryptocurrency wallet. The announcement stated that this feature will be discontinued as early as November of this year, reminding users to take note of the timeline and withdraw wallet assets promptly. Prior to this, the company reported quarterly losses of approximately $100 million, leading to the dismissal of its former CEO Matt Furlong.

GameStop Web3 Wallet to Cease Operations

The U.S. video game retailer GameStop announced today that it will be shutting down its cryptocurrency wallet service, citing "regulatory uncertainty in the crypto space" as the reason.

According to the official notice on its website, GameStop will begin removing its iOS and Chrome extension cryptocurrency wallets starting November, and advises users to ensure they have access to their mnemonic phrases and withdraw their assets from the wallet by November 1st.

Reportedly, the wallet's beta version was launched in May last year, allowing users to deposit, send, and trade cryptocurrencies and NFTs.

The regulatory uncertainty mentioned can be attributed to ongoing lawsuits by the U.S. Securities and Exchange Commission (SEC) against several exchanges and crypto companies, which are currently underway.

Transition Hindered by Market Downturn

GameStop has been exploring blockchain technology since 2020 and has been striving to transform into a diversified company based on gaming, but the journey seems to have been rocky.

As its first step into the crypto space, the company publicly recruited engineers familiar with Solidity and Python languages to join its team in 2020. In March last year, it launched a beta version of a Web3 wallet running on the Ethereum L2 scaling solution Loopring, as well as an NFT platform which is now closed and integrated.

In December last year, GameStop's former CEO Matt Furlong announced the dissolution of the digital assets division, stating that cryptocurrency was no longer a focus for the company. He was subsequently fired in June this year, with speculation from the public that his departure was due to the company's quarterly losses nearing $100 million under his leadership, forcing him to step down.

At that time, he also posted a cryptic message on Twitter at the time.

GME Epic Short Squeeze Event

Prior to this, in January 2021, the company experienced a significant surge when Reddit users rallied to support GameStop investors against the well-known short-selling firm Citron Research, causing the stock GME to skyrocket over 3,000% in a month, forcing related institutions to close their positions and gaining widespread attention.

At the time, this event not only drew the attention of the U.S. Securities and Exchange Commission (SEC) and the Treasury Department, but also became a focal point in the global media.

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