Square, the payments company helmed by Twitter CEO Jack Dorsey, announced Thursday it has bought 4,709 bitcoins, worth approximately $50 million. This represents about 1% of Square’s total assets as of the end of the second quarter of 2020.
“Square believes that cryptocurrency is an instrument of economic empowerment and provides a way for the world to participate in a global monetary system, which aligns with the company’s purpose,” the company said in a press release.
This is not Square’s first foray into crypto. In 2018, the company expanded its mobile payment service Cash App to support bitcoin trading, even for users without a bank account. And in 2019 it launched Square Crypto, which awards grants to bitcoin developers and designers.
Jack Dorsey, CEO of Twitter and Square, has long been a proponent of bitcoin, saying in 2018 that he believes it will eventually become the world’s single currency within the next decade. Dorsey, who also owns an undisclosed amount of bitcoin personally, said during an earnings call in 2018 that “Bitcoin, for us, is not stopping at buying and selling. We do believe that this is a transformational technology for our industry and we want to learn as quickly as possible.”
Square is also now the second technology firm to go long on bitcoin in recent months after MicroStrategy, a business intelligence firm, crowned the crypto as its treasury reserve asset of choice.
MicroStrategy invested $425 million into bitcoin, according to a series of disclosures that pumped the stock’s value and revealed its CEO, Michael Saylor, to be an unexpectedly vocal bitcoin maximalist.
In May, Square reported its bitcoin revenue for the first quarter was $306 million, on total revenue of $1.38 billion. That’s an increase of 367 percent from the year-ago quarter, the company reported, adding that the rise was “due to growth in the number of active bitcoin customers, as well as growth in customer demand.”
But, someone doesn’t like that.
Bitcoin spiked 4% on news that Square invested $50 million (1% of total assets) into #Bitcoin. But that buying has already taken place. Speculators are betting the announcement will attract new buyers. The real news is Square’s buying failed to push Bitcoin above its 2019 high.
— Peter Schiff (@PeterSchiff) October 8, 2020
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