Square has bought more bitcoin, adding $170 million worth of the cryptocurrency to its balance sheet. The company now holds 5% of its cash reserves in bitcoin. Its Cash App was used by more than three million customers to purchase or sell the cryptocurrency last year.
$170 Million Bitcoin Purchase
Square Inc. (NYSE: SQ) announced Tuesday its fourth quarter and full year 2020 results. The company also announced that it has purchased $170 million worth of bitcoin â€œas part of its ongoing commitment to the cryptocurrency.â€ This is the companyâ€™s second bitcoin purchase; the first was for $50 million made in October last year. According to the announcement:
â€œSquare believes that cryptocurrency is an instrument of economic empowerment, providing a way for individuals to participate in a global monetary system and secure their own financial future,â€ the company explained. â€œThe investment is part of Squareâ€™s ongoing commitment to bitcoin, and the company plans to assess its aggregate investment in bitcoin relative to its other investments on an ongoing basis.â€
Increased Bitcoin Adoption via Cash App
The NYSE-listed company, led by CEO Jack Dorsey who also heads Twitter Inc., is seeing increased bitcoin adoption. Its Cash App allows people to buy and sell BTC. According to Squareâ€™s earnings report released Tuesday:
â€œFurthermore, in the fourth quarter of 2020, bitcoin volumes per customer were up more than 2.5x year over year, primarily driven by buying activity,â€ Square continued.
In addition, the company disclosed that â€œDuring the full year 2020, we saw significant growth in bitcoin revenue year over year.â€ Noting that â€œBitcoin revenue is the total sale amount of bitcoin to customers,â€ Square wrote:
As for the fourth quarter, â€œCash App generated $1.76 billion of bitcoin revenue and $41 million of bitcoin gross profit â€¦ up approximately 10x and 13x year over year, respectively.â€
What do you think about Square keeping 5% of its cash reserves in bitcoin? Let us know in the comments section below.
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