Square doubled its quarterly BTC revenue to $1.6 Billion according to the Q3 letter to its stakeholders as we are seeing more in our Bitcoin news today.
According to the report, Square doubled its earnings with Bitcoin revenue from its Cash App hitting $1.63 billion. Square reported $1.63 billion in BTC revenue from its Cash App for the third quarter and made a gross profit of $32 million from that figure. Bitcoin is a key part of the platform but only a small part of the profits. People are buying Bitcoin still from the Cash app. In the letter to the stakeholders, Square reported revenue from BTC sales of $1.63 billion from its Cash App for a gross profit of $32 million in the third quarter of this year.
— Square IR (@SquareIR) November 5, 2020
That represents a 1,100% increase from Q3 in 2019 and the revenue also increased from the second quarter in 2020 when Square raked in $875 billion from buyers, buying Bitcoin on the Cash App. According to the letter, “Bitcoin revenue and gross profit benefited from an increase in Bitcoin actives and volume per customer.”
Bitcoin is a key part of the app’s offerings as it allows users to purchase stocks and auto-invest for stocks or BTC in addition to sending and receiving cash. Still, it generates high revenues as Bitcoin is not the main profit center of the platform. The $32 million in gross profit from Bitcoin is a fraction of the $385 million gross profit across the Cash App. The latter explains why the company points to $435 million in revenue from the Cash App excluding the BTC revenue:
“We deduct bitcoin revenue because our role is to facilitate customers’ access to bitcoin. When customers buy bitcoin through Cash App, we only apply a small margin to the market cost of bitcoin, which tends to be volatile and outside our control.”
Explaining the report, Square CEO Jack Dorsey reiterated that the company believes BTC will become the “native currency of the internet.” This goes beyond making it available for purchase via the Cash App as the company also holds BTC on its books. Square purchased 4,709 BTC worth $50 million at the time of the purchase. With that purchase, when combined with Microstrategy’s strong BTC buys and PayPal’s entry into the BTC space could help explain why Square’s BTC is now worth closer $72 million.
DC Forecasts is a leader in many crypto news categories, striving for the highest journalistic standards and abiding by a strict set of editorial policies. If you are interested to offer your expertise or contribute to our news website, feel free to contact us at [email protected]