The second United States fintech giant puts hundreds of millions into Bitcoin in less than a month.
Square Inc, the payment company behind the popular Cash App, bought 4.709 Bitcoins, approximately worth $50 million. As the company stated in its October 8 announcement, the investment in Bitcoin represents approximately 1% of Square’s total assets. The company’s total assets worth is around $5 billion at the end of the second quarter of 2020.
One of the largest payment processing companies in the United States, Square believes cryptocurrency is the instrument of economic empowerment as it provides the ability to participate in the global monetary system for anyone in the world. According to the fintech giant, this aligns with the company’s purpose. Square’s Chief Financial Officer Amrita Ahuja said:
We believe that bitcoin has the potential to be a more ubiquitous currency in the future. As it grows in adoption, we intend to learn and participate in a disciplined way.
Square’s popular mobile payment app Cash App, allows trading Bitcoin since 2018. Furthermore, the majority of 7 million user Cash App revenue came from Bitcoin which outranked the company’s revenue in fiat for the first time in Q1 2020.
The crypto community shows their likes
The crypto market reacted positively to Square’s investment. The Bitcoin jumped up by 3.17% within the past 24 hours, and trades at around $10.902 at the time of writing, according to Messari.
The unexpected announcement raised positive reactions across the cryptocurrency community. Anthony “Pomp” Pompliano, the famous entrepreneur and blockchain investor, welcomes the Square’s investment in his Youtube video:
According to Pompliano, Square made an enormous move that will help Bitcoin grow and expertly navigated the waters by bringing Bitcoin on its balance sheet.
I love this move. Every company is gonna do this. The dollar just continues to lose value in a zero interest rate environment.
Not the first high-profile investor
With its recent $50 million investment, Square joins the club of other Bitcoin super investors. Just a few weeks ago the MicroStrategy, the billion-dollar worth business intelligence firm, completed its second round of purchasing 38.250 Bitcoins worth of over $425 million.
In August the company became the first publicly-traded company that recognized Bitcoin as a legitimate investment and made it its primary treasury reserve asset. MicroStrategy bought its first $250 million worth of Bitcoins in August claiming the investment to be a hedge against the US dollar inflation.
As claims Michael J. Saylor, the CEO of MicroStrategy, “the investment reflects company’s belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”
MicroStrategy and Square are not the only publicly traded companies oriented to Bitcoin. Despite the Grayscale Bitcoin Trust ($4.8 billion worth Bitcoin holdings) being the undisputable leader, the entities like Galaxy Digital Holdings, Riot Blockchain, and Cypherpunk Holdings Inc are also among the top publicly traded companies with million-worth investments in the world’s leading digital currency.