Square’s Bitcoin Turnover Skyrocketed by 785% in 2020
- Square’s Bitcoin turnover in 2020 was $4.5 billion, which is 48% of the year’s total turnover
- Square’s Bitcoin turnover increased by 785% since 2019, as the company doubles down on Bitcoin investments
- Square’s Bitcoin holding was worth 5% of their total assets in 2020
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Square Inc. (NYSE:SQ) is an American Fintech founded in 2009 by Jack Dorsey, CEO and Cofounder of Twitter, and Jim McKelvey, Cofounder of LaunchCode. The Fintech company started off as a card reader provider for SMEs. Currently, Square’s hardware division provides state-of-the-art card readers that help sellers accept chip and PIN and contactless payments. The company has also expanded into serving retail customers through CashApp, which is the United States’ largest mobile payment app alongside Venmo.
The company was founded on the mission of providing small, micro, and independent businesses access to digital payments processing. Prior to Square’s card readers, small business owners could not serve customers whose payments preference were credit or debit cards due to high fees and costs of operating a card machine. Now, the company serves millions of independent merchants and vendors and provides more than 24 million US citizens with access to mobile banking.
“We’re empowering electricians to send invoices, helping clothing boutiques see what’s selling best, and providing stores with a faster way to serve customers. We’re here to help sellers of all sizes start, run and grow their business – because helping them grow their business is good business for everyone.”
48% of Square’s 2020 turnover comes from Bitcoin
In 2020, Square made $4.5 billion in Bitcoin sales revenue, an increase of $4 billion from 2019. Square’s 2020 total revenue was $9.4 billion, which means their Bitcoin turnover raked in nearly half of the year’s total sales. Compared to 2019, the company saw a 100% increase in total revenue.
Square is doubling down on Bitcoin
As the public Fintech finds itself at the forefront of the American mobile banking race, in 2020, the company decided to purchase approximately 4,709 bitcoins at an aggregate purchase price of $50 million. In February 2021, Square bought an additional $170 million worth of Bitcoin which brings the Bitcoin holding to approximately 5% of the company’s total assets in 2020.
The company positioned its Bitcoin initiative at the heart of the late 2020 Bitcoin bull run in order to serve millions of customers who demand for a safe and secure place where they can store their cryptocurrencies.
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 investment represents approximately one percent of Square’s total assets as of the end of the second quarter of 2020.
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Square has previously invested in bitcoin from a product, leadership, and legal innovation perspective, and today adds this financial investment. The company launched bitcoin trading in 2018 with Cash App, which enables the buying and selling of bitcoin.
In 2019, the company formed Square Crypto, an independent team solely focused on contributing to bitcoin open-source work for the benefit of all, and also recently launched the Cryptocurrency Open Patent Alliance (COPA), a non-profit organization encouraging crypto innovation and opening access to patented crypto inventions.
Big Plans for 2021
CFO Amrita Ahuja will be investing $850 million in operating expenses, including marketing and customer acquisition, product development, and hiring Fintech talents throughout the rest of the year. CashApp, as Square’s Fintech poster child, will be receiving the majority of this humongous investment budget. As CashApp is rapidly expanding and evolving towards a more all-round complete financial service provider, there will be major investments in improving features such as Cash Card, Boosts, Bitcoin and stock investing. Slowly but surely, Square is going to offer everything that a traditional bank offers right now. The rise of the company will be the front cover story whenever and wherever Fintech is discussed.
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