In an interview today, Square’s CFO, Amrita Ahuja, said the company has no plans to buy more bitcoin.
This comes on the heels of a significant Bitcoin drop following Tesla’s announcement that it will no longer accept bitcoin payments for its goods.
A Decrease in Enthusiasm
After Elon Musk announced that Tesla would no longer welcome Bitcoin, the unbridled electric energy in the air surrounding Bitcoin was momentarily halted. Major cryptocurrencies plummeted over 20% shortly after Musk announced that Tesla would no longer embrace BTC.
Square’s vast Bitcoin holdings – 8,027 bitcoins – took a temporary hit, owing to the company’s most recent acquisition ($170 million with a cost basis of over $51,200). In terms of BTC, Square is now up over $200 million (their initial purchase was at a lower price). Despite this, upper management is likely to slow the speed of their diversification into riskier assets due to the recent drop.
This news, on its own, isn’t enough to quell the world’s undeniable curiosity in cryptocurrencies. Square posted a record $3.5 billion in Cash App sales in Q1 2021, smashing previous peaks thanks to Bitcoin transactions. Analysts’ projections for quarterly earnings were beaten by more than double.
Square’s Bitcoin-related income has increased 11-fold, and CEO Jack Dorsey is a strong supporter of cryptocurrency. Despite yesterday’s setback, he claimed earlier this year that Bitcoin is the Internet’s native currency, and analysts expect corporations’ increasing support for cryptocurrencies to continue throughout the coming months.