Square buys $170 million more in bitcoin to increase their investment in the cryptocurrency
Square, the payments company that is responsible for the popular financial app Cash App and is led by Twitter CEO Jack Dorsey, announced on Tuesday, February 23, the purchase of $174 million in bitcoin.
In this afternoon’s announcement, the company claims to have purchased 3,318 bitcoins, which add up to 4,709 that the company acquired in October 2020, at a price of $ 50 million. Thus, it reaches a total invested of 224 million dollars for 8,027 bitcoins, which, in the current quote, are equivalent to almost 390 million dollars.
Michael Saylor, CEO of MicroStrategy, a software company that has more than $3 billion in bitcoin, was one of the first to speak out about the transaction: “Square today announced the purchase of 3,318 bitcoins for an aggregate price of 170 million combined with the previous purchase of 50 million dollars in bitcoin, this represents 5% of the company’s total cash…”he said on Twitter.
The company’s investments in bitcoin are part of the strategy to diversify the company’s equity, which also offers crypto trading to the more than 36 million users of the Cash App. According to Square, in the fourth quarter of 2020 alone, the company sold 1,76 billion dollars in bitcoin in their app.
Net profit from cryptocurrency transactions over the past year was $97 million, or 2% of the total traded, way below what the cryptocurrency earned over the year, which may explain the company’s intention to increase their exposure to digital assets.