Square (NYSE:SQ) Bitcoin Stake Reaches US$220 Million

3 min read | February 25, 2021 03:49 PM AEDT | By Mark O'Donnell

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Square (NYSE:SQ) Bitcoin Stake Reaches US$220 Million

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Summary

Square has purchased US$220 million worth of Bitcoin since October last year.

MicroStrategy and Tesla joins Square as the only US public companies to have Bitcoin on their balance sheets.

MicroStrategy’s CEO believes Bitcoin could be worth US$100 trillion one day.

Square Inc (NYSE:SQ) has recently reported the purchase of US$170 million worth of Bitcoin. The announcement coincides with the release of the merchant payment companies’ annual results.

The US$170 million purchase complements the Company’s purchase last October of US$50 million worth of Bitcoin. Bitcoin now represents 5% of Square’s cash or cash equivalent holdings. The Company has indicated that it will continuously update its position as the price of Bitcoin fluctuates.

Square CEO Jack Dorsey has been a long-time advocate of Bitcoin. Mr Dorsey, Also the CEO of Twitter Inc (NYSE:TWTR), frequently promotes the cryptocurrency via tweets. Recent tweets suggest the mogul believes the digital asset is the internet-money for the future.

Source: © Piter2121 | Megapixl.com

The purchase of Bitcoin by Square is intended to signify the Company’s commitment to the currency and digital currencies in general. Square has indicated that accepting digital currencies via the Company’s payment platform is possible in the future.

On 24 February, Square shares last traded at US$237.32, decreasing by 7.51%, with a market capitalisation of US$107.02 billion.

Bitcoin rose 7% in the few hours that preceded Square’s announcement. On 25 February, at the time of writing, Bitcoin was trading at NZ$67,854, up by 3.77%.

Bitcoin and Wall Street

Three publicly traded US companies have now thrown their hat in the cryptocurrency ring.

The first to add Bitcoin to its balance book was MicroStrategy Inc (NASDAQ:MSTR), with the purchase valued at US$1.1 billion. Few days ago, the business intelligence firm concluded 2 convertible debt offerings for the purpose of raising capital. The proceeds would be utilised to make further purchases.

MicroStrategy’s Chief Executive Officer, Michael Saylor predicts Bitcoin will be worth 100 times what it is valued at present time, sometime in the future. If Mr Saylor is proven right, Bitcoin would have a valuation of over US$100 trillion, making it the most valuable asset in the world ahead of gold reverse, as well as Apple Inc (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT).

Tesla Inc (NASDAQ:TSLA), the Electric Automobile Company purchased US$1.5 billion worth of Bitcoin earlier this month and announced that it would soon start accepting payment in the digital currency. Bitcoin represents 8% of Tesla’s cash or cash equivalent holdings. The price of Bitcoin jumped 50% in the days after Tesla’s announcement.

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