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Square invests $170 Million in Bitcoin

Square invests $170 Million in Bitcoin

The San Francisco-based payments company, Square Inc., revealed that it had bought a further 3,318 Bitcoins worth $170 million on Tuesday. Mentioning in Square’s Q4 earnings report for 2020, the company established in 2009 by Twitter co-founder Jack Dorsey, yet has 24.4% held by him. Moreover, the new Bitcoin purchase arises from a former purchase worth $50 million. If combined, this signifies around 5% of Square’s total cash, cash equivalents, and marketable securities as of December 31, 2020.

The Q4 Bitcoin acquisitions imply that Square paid around $51,000 per Bitcoin. Since then, the price of Bitcoin has experienced a massive downturn. It fell 16% to below $47,000 before rallying to its recent price of $48,130. The payments giant witnessed revenue in the final quarter of 2020, more than double to $3.16 billion. Q4’s figures were higher from the $1.31 billion recorded a year earlier and exceeded market expectations for $3.10 billion.

Over 4 Million users traded Bitcoin via Cash App in 2020

Further, the Q4 revenue for Square comprises $987 million from its seller business and $12.7 billion from the Cash App. CashApp enables its users to purchase Bitcoin and some stocks and transfer and receive money almost immediately. It also allows the transfer of tokens, with a user experience as uniform as a banking platform. The P2P bitcoin remittance service had been operating on the platform since 2013. However, CashApp launched support for Bitcoin trade with fiat money only in 2018. Square Inc. unveiled that over 4 million consumers bought or sold Bitcoin on the Cash App in 2020.

The latest investment in Bitcoin by Square comes after the increased interest in Bitcoin by institutional investors. Earlier this month, Elon Musk’s Tesla’s latest filing with the SEC unveiled that Tesla acquired $1.5 billion worth of Bitcoin. Square’s co-founder Jack Dorsey is one of Bitcoin’s leading enthusiasts who has frequently shared his passion for cryptocurrencies, stating it offers an opportunity to get more people to access the financial system.

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