American video game retailerGameStop(GameStop) announced on Tuesday that its board of directors unanimously approved a plan to use company cash to purchase Bitcoin, following the example of MicroStrategy (now renamed Strategy). The company's shares rose more than 7% in after-hours trading on Tuesday after the news was announced. The statement confirms media reports from February that GameStop intended to add Bitcoin and other cryptocurrencies to its balance sheet.

The company said some of its cash or future debt and stock issuances may be invested in Bitcoin and U.S. dollar-denominated stablecoins. As of February 1, GameStop held nearly $4.8 billion in cash. The company also stated that there is no cap on the amount of Bitcoin that may be purchased.

GameStop's move into the cryptocurrency market marks the latest effort by CEO Ryan Cohen to revive its struggling brick-and-mortar business. Under Cohen's leadership, GameStop is focusing on cutting costs and streamlining operations to ensure a profitable business.

The company said the move could expose it to volatility related to cryptocurrency prices.

"For example, Bitcoin is a highly volatile asset, and its price can fluctuate significantly over time. Our Bitcoin strategy has not been tested and may fail," GameStop said in a filing with the U.S. Securities and Exchange Commission (SEC).

While announcing its Bitcoin strategy, GameStop also announced its fourth-quarter results, with net profit of US$131.3 million, more than double the US$63.1 million in the same period last year.