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Topic: Square invests 50 million USD in BTC: instrument of economic empowerment (Read 699 times)

legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
Square announced their Quarterly results:

Square, Inc. Announces Second Quarter 2021 Results

All details are available on Square Investor Website


On the Cashapp section, we read that:

Quote
Cash App generated $2.72 billion of bitcoin revenue and $55 million of bitcoin gross profit during the second quarter of 2021, each up approximately 3x year over year. Bitcoin revenue and gross profit benefited from year-over-year increases in the price of bitcoin and bitcoin actives, and growth in customer demand. Compared to the first quarter of 2021, bitcoin revenue and gross profit decreased on a quarter-over-quarter basis, driven primarily by relative stability in the price of bitcoin, which affected trading activity compared to prior quarters.
In future quarters, bitcoin revenue and gross profit may fluctuate as a result of changes in customer demand or the market price of bitcoin, particularly as we lap strong growth rates on a year-over-year basis in the second half of 2020.

I updated my spreadsheet



While Grayscale stopped their buys, Square kept the pace, albeit with a little bit of slowing:



legendary
Activity: 2492
Merit: 1490
Jack Dorsey said that Square will launch a business aimed at creating an open platform for developers of non-custodial, inclusive and decentralized financial services. Dorsey noted that the platform intends to adhere to the principles of full openness, this applies to the roadmap, development and source code.



The initiative will be led by Mike Brock, head of the strategic direction of Square. He has already started selecting a team and introduced a number of developers.





An investment fund managed by Katie Wood, Ark Invest, on Friday bought more than 225,000 XNUMX shares in Square, a day after the company launched its new bitcoin business.



[moderator's note: consecutive posts merged]
legendary
Activity: 1946
Merit: 1072
Leading Crypto Sports Betting & Casino Platform
I do believe that when bigger companies end up spending money to increase crypto adoption that is just a good thing. Think about it if Square helped Coinbase with 50 million dollars waaay back when they first started, maybe the whole USA situation in crypto world would have come a lot sooner and that is what I really want to do, have a nation where we know what we are doing and that is the direction we would have taken as well.

It is not an easy task of course and I understand the logic but with more and more companies investing into not just buying crypto but also investing into  crypto related stuff that is going to change the shape of the world. I really do want to think that we could do that, it is just that we need to encourage other places to invest into crypto stuff as well and that will get more common when the earlier ones like Square makes a good profit from it.
legendary
Activity: 3444
Merit: 1162
www.Crypto.Games: Multiple coins, multiple games
Square is owned by Jack who owns Twitter which means that these "corporations invest into bitcoin" thing is getting bigger. Of course Tesla invested 1.5 billion dollars so comparing this 50 million versus the 1.5 billion this is a small piece of the cake.

However realize that if all the companies in the world who have some cash reserved in bank account that they haven't used yet, ends up putting all of that money into bitcoin until they need to spend it, that would cause bitcoin to be 100k+ very easily, probably closer to 200k in reality. That is why we should be supporting every single investment like this, doesn't matter if it is small or not because we really need every bit of that money, even if it is just thousands of dollars. Jack is a good guy, I haven't heard anything bad about him at least, and that is something I can be happy about when a person like that invests into bitcoin.
jr. member
Activity: 31
Merit: 26
Square will also create its own hardware wallet and a service for storing bitcoin. This was announced by the head of the hardware product development department of the payment company, Jesse Dorogusker. Given the fact that there are really a lot of problems in the hardware wallet market, I think the appearance of new products will give users more choice.



Indeed, custody has been a critical aspect of Bitcoin UX in the past and continues to be a cumbersome task for most users. Not everyone will have the privilege to afford professional custody, provided that one of such acts in the relevant juristiction. Hence solution like this will greatly help the use of bitcoins.


Quote

Jesse Dorogusker said that the Bitcoin hardware wallet product must have the following directions: Bitcoin first, global distribution, multi-signature to achieve "assisted self-custody", and give priority to mobile usability.


I have also paid attention to this information. This matter is moving in a better direction. I feel very excited because of their attempts and efforts. I will continue to pay attention to it.

legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
Square will also create its own hardware wallet and a service for storing bitcoin. This was announced by the head of the hardware product development department of the payment company, Jesse Dorogusker. Given the fact that there are really a lot of problems in the hardware wallet market, I think the appearance of new products will give users more choice.



Indeed, custody has been a critical aspect of Bitcoin UX in the past and continues to be a cumbersome task for most users. Not everyone will have the privilege to afford professional custody, provided that one of such acts in the relevant juristiction. Hence solution like this will greatly help the use of bitcoins.
legendary
Activity: 2492
Merit: 1490
Square will also create its own hardware wallet and a service for storing bitcoin. This was announced by the head of the hardware product development department of the payment company, Jesse Dorogusker. Given the fact that there are really a lot of problems in the hardware wallet market, I think the appearance of new products will give users more choice.


legendary
Activity: 2492
Merit: 1490
Jack Dorsey said that Square is considering creating a hardware wallet for bitcoin. When creating it, the company will be guided by the principles of maximum openness-from using open source software to designing the appearance in cooperation with the community.
Dorsey also noted that the potential product could be combined with the Cash App.  https://twitter.com/jack/status/1400839179513339905


sr. member
Activity: 1624
Merit: 309
Leading Crypto Sports Betting & Casino Platform
This company really know what to put on their bags, they wouldn’t bought it without a reason they probably they want to miss Bitcoin. I feel positive about this and sooner or later more companies will follow their steps, companies are fomoing now or others might secretly bought some Btc’s.
Will these purchase increase the prices though because considering how big Tesla has bought, 50 million isn't a lot for a company like Square, I feel like these purchase is going to be a short-term one.
legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
These tables are quite confusing for me. I use only https://www.bybt.com/Grayscale where I can see 653K BTC's in Greyscale possesion. And this hasn't changed for 3 months, meaning no buying occured. Which is strange, since the other day they announced a buy for $200mil which would be 3-4K BTC but this is not visible on the chart. They also are going to buy more with $550mil in the next days/weeks. And that negarive premium - to whom are they selling those shares?

I think the right place to discuss those are on my thread:
Everything you wanted to know about Grayscale BTC Trust but were afraid to ask!

Anyway, just some superquick answer:

  • No buying occurred, but as you can see from the spreadsheet in my Grayscale thread, they bought some coins back in January, which is Q121
  • The buying of 200 Million is buying in shares. They are buying in the secondary market. All these graphs are regarding the primary market or the issuance of the shares.
  • When they buy the shares they have two options: either hold for future sells or destroy them, reducing the AUM of the fund.
legendary
Activity: 1843
Merit: 2804
All good things to those who wait
These tables are quite confusing for me. I use only https://www.bybt.com/Grayscale where I can see 653K BTC's in Greyscale possesion. And this hasn't changed for 3 months, meaning no buying occured. Which is strange, since the other day they announced a buy for $200mil which would be 3-4K BTC but this is not visible on the chart. They also are going to buy more with $550mil in the next days/weeks. And that negarive premium - to whom are they selling those shares?
legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
On this page you can find all the information about Square quarterly results:

Latest Quarter | Q1 2021

On this page, there is a truckload of information.

On this excel spreadsheet there is this information:



What are those Bitcoin Costs?

According to the Q1 2021 Shareholder Letter:

Quote
Bitcoin costs are the total amount of bitcoin that we purchase.
We purchase bitcoin to facilitate customers’ access to bitcoin

This is the first time I see this explicitly reported, but the numbers are in line with previous reports.

So i plugged those numbers in my spreadsheet:



This is impressive, given the astronomical rise in the underlying BTC price.






legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
I totally missed this news:

Square Buys $170 Million More Bitcoin, Deepening Crypto Bet

Quote

Square Inc. said it purchased $170 million in Bitcoin, further committing to the cryptocurrency and raising its holdings to about 5% of the company’s cash and equivalents.


Today Square reported his earnings, and i there discovered this news I totally missed.

I will update here other relevant news in the earnings conference.
sr. member
Activity: 1526
Merit: 420
This company really know what to put on their bags, they wouldn’t bought it without a reason they probably they want to miss Bitcoin. I feel positive about this and sooner or later more companies will follow their steps, companies are fomoing now or others might secretly bought some Btc’s.
legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
While I see plenty of reason why you should diversify your investment with 1% bitcoin, and some other like Fidelity think you should go up to 5%, I can’t see a reason why I should invest any amount in any shitcoin.

I am so sure about this because this is exactly the investment thesis I decided to follow when I invested in Bitcoin.

legendary
Activity: 2296
Merit: 1101

I am pretty sure there must be something wrong with that calculation, are you sure that total wealth is at 360 billion?



You are correct, I got once again stuck in the middle of an edit and left inconsistent digits: the total wealth is 360,000 billions, or 360 trillions. The important thing is the final bitcoin value is correct at 175,000 USD!
But that makes it harder, we are talking about 360 trillion wealth and you want 1% of that, that is not really realistic is it? Sure you could "expect" it but just because you and I expect such a thing doesn't mean it will happen. I think wanting 1% of all the wealth in the entire world to be in crypto is something a bit too much.

However we should also not forget that 1% of 360 trillion is 3.6 trillion dollars, as a whole market we have seen crypto reach 1 trillion dollars. So, what I would suggest is to make sure you do your calculation once again, and this time instead of bitcoin at 3.6 trillion dollars which would be very very difficult, just consider 3.6 trillion as the whole market, the crypto one, so at that point you have to take a look at bitcoin domination and recalculate it. It won't be 170k, but it could be something along the lines of 80k or so, which is a bit more realistic if you ask me.
legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23

I am pretty sure there must be something wrong with that calculation, are you sure that total wealth is at 360 billion?



You are correct, I got once again stuck in the middle of an edit and left inconsistent digits: the total wealth is 360,000 billions, or 360 trillions. The important thing is the final bitcoin value is correct at 175,000 USD!
legendary
Activity: 2296
Merit: 1101
One of the first "model" I used when I decided to buy Bitcoin was based on the question: "What happens if everyone decides to buy 1% of their financial wealth in Bitcoin?"

Well the answer is this one (updated figures):

World Adult Wealth (bln)   360
1% of such Wealth is (bln)   3.6
   
   
Circulating Bitcoin   21,000,000
This is an overstatement, but I want conservative estimates.

   
Bitcoin Value   3,600,000,000,000/21,000,000 equal to USD 171,428.57.

So, yes, 1% is a lot!
I am pretty sure there must be something wrong with that calculation, are you sure that total wealth is at 360 billion?

I thought only the first 10 richest people in the world worths more than that, how could we say that the total combined is like that? I don't know what the real number is, I don't know what the combined wealth looks like, but at the end of the topic is, even if at 1% of everyone going in, we are only 17x, so that shows you how we have a big cap.

I understand you used this example to say bitcoin could go up even with "just 1%" but that 1% is huge, nobody has 1% in everything, people usually either do not invest because they are too poor, or they invest into 2-3 things at most, very few people invest into 10+ different things.

To ask everyone and I mean EVERYONE in the world to put 1% of their money to bitcoin is not realistic at all and even with that we are only at 170k.
hero member
Activity: 2898
Merit: 669
www.Crypto.Games: Multiple coins, multiple games
Honestly it doesn't really shock me that people are getting into bitcoin wholesale. These are big companies and it makes sense for them to risk it like this, if they fail at the very worst they would be CEO's and so forth who lost hundreds of millions of dollars and they would totally be fine, who cares because they have a great resume, but if they actually achieve stuff like 2x return to investors, it would be surreal, they would be one of the most famous companies in their sector and they would get ton of new investors.

Why should we care about something as small as 50 million dollar investment? Look at all the miners, there is over a billion dollars invested into mining sector already, we are already getting huge with the big companies for the past 2-3 years anyway.
legendary
Activity: 2114
Merit: 15144
Fully fledged Merit Cycler - Golden Feather 22-23
I am not sure that anyone would say that the company’s 1% investment is too small, like seriously? They invested 1% of the company’s total asset which is worth $50 million, how is that a small amount? That’s a huge amount and is enough already if they decide.

It’s recommended that people should around 1% to 5% of their total assets in cryptocurrency, so they did the right thing, because even that, is a very high amount of money.

Although that for some of us, our 1% to 5% would be very useless when invested in cryptocurrency. As for those who have the money, they can go for it and keep investing , at least the community should be growing. This step can motivate other companies to take the same step.

One of the first "model" I used when I decided to buy Bitcoin was based on the question: "What happens if everyone decides to buy 1% of their financial wealth in Bitcoin?"

Well the answer is this one (updated figures):

World Adult Wealth (tln)   360
1% of such Wealth is (tln)   3.6
   
   
Circulating Bitcoin   21,000,000
This is an overstatement, but I want conservative estimates.

   
Bitcoin Value   3,600,000,000,000/21,000,000 equal to USD 171,428.57.

So, yes, 1% is a lot!

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