GameStops NFT Marketplace launches at the worst possible time
In a move that surprises absolutely no one, GameStop has entered NFTs. The video game retailer launched its own NFT marketplace today, reaching over one million dollars in volume in just a few hours after they were published. Crypto brothers and monkey keepers around the world are celebrating the launch, but from both an economic and an ethical point of view, it could not have been a worse time for GameStop NFT.
NFTs have been the major talking point on the Internet for quite some time now. People with hexagonal profile pictures sing praises on Twitter, and it feels like you can not go into a comment section anywhere these days without seeing a poorly drawn cartoon monkey. However, people with common sense are well aware of the many disadvantages of these non-fungible tokens. Environmental damage, widespread fraud and other blockchain problems only scratch the surface of what is wrong with NFTs, depending on who you ask.
Regardless of your feelings about NFTs, the launch of Gamestop’s NFT marketplace could not have come at a worse time. The crypto market is not in a good place right now. We are in the middle of a crypto winter, a period when huge hedge funds are collapsing and coin prices are plummeting. Companies such as Coinbase, BlockFi and Crypto.com have had to lay off hundreds of employees. Bitcoin, Ethereum and just about every major cryptocurrency out there have dropped significant percentages so far this year. What better time to launch a new NFT marketplace?
Of course, GameStop claims that their NFT marketplace is forward-looking, and builds towards a more interconnected future with true digital ownership and all sorts of other buzzwords. The marketplace will “expand the functionality to include more categories such as Web3 games, more creators and other Ethereum environments” according to a press release. That press release is followed by a “warning statement regarding forward-looking statements” that is almost three times as long as the actual announcement. It is one thing to cover your bases with cautious legal speech, but a 3 to 1 relationship between caution and action is not a good sign.
That’s just the financial side of the issue. Prices are climbing and falling and the economy is adjusting, so maybe GameStop’s future-oriented NFT plan will be financially successful in the long run. Maybe they really reason with meme stock traders and cryptobros with this one. No matter how much money flows into GameStop from this whole endeavor, the dubious ethics of the situation cannot be ignored.
BREAKING: GameStop CFO out, layoffs across the company, including at GameStop proper and Game Informer. Unclear how hard people have been hit, but does not sound small. “a number of reductions” according to company note
– Stephen Totilo (@stephentotilo) July 7, 2022
GameStop started a round of mass layoffs last week and fired its CFO in the process. Around 160 employees were cut, including the editorial staff of Game Informer. People’s livelihoods were directly affected by the launch of this NFT marketplace and GameStop’s general turning point for crypto. “Change will be constant as we develop our trading business and launch new products through our blockchain group,” reads the first line of an email sent to GameStop employees by CEO Matt Furlong. It took only 18 words for the CEO to address the blockchain in a memorandum on redundancies.
“Having invested heavily in personnel, technology, inventory and supply chain infrastructure over the past 18 months, our focus is on achieving sustainable profitability,” reads another line from Furlong’s email. GameStop experienced another round of layoffs at the company’s headquarters in May, according to a Kotaku report, which affected more than 100 employees. They were probably cut to accommodate new hires with experience in “blockchain gaming, e-commerce and technology and operations”, something the company was very happy to mention in its earnings report for the first quarter of the financial year 2022.
The timing of it all is unfortunate, but expected. People are gone and now the NFTs are here. The GameStop NFT Marketplace is currently filled with such glorious works as Dankclops # 69, a pixel monster currently valued at 100 ETH (approximately $ 104,000 USD). If that’s not really your style, you might be interested in Bluetooth, a rotating gif of a blue tooth priced at 420.69 ETH (about $ 438,000 USD)? These two symbols are just a small taste of the exquisite collection of over 53,000 NFTs available on GameStop.
No matter how you look at it, GameStop’s NFT marketplace opens up at an awful time. It is a blockchain-based project that starts at a time when the crypto is plunging. It is launched immediately after a round of mass layoffs of which it is the sole culprit. The company’s CEO sounded more excited than remorseful when he emailed employees about the layoffs simply because the cut jobs were sacrificed for shiny new blockchain technology. Even its forward-looking plans are flawed, as existing attempts to incorporate NFTs and the blockchain into mainstream gaming have failed spectacularly. GameStop’s NFT marketplace is a meaningless, soulless project that only serves to extract more money from an already dying company that can not even afford to keep its employees busy.
