Square invests $50 million in Bitcoin

Shawn Knight

Posts: 12,593   +124
Staff member
In brief: American financial services company Square on Thursday announced it has spent roughly $50 million, or approximately one percent of its total assets, to purchase 4,709 Bitcoins. The company said it believes the cryptocurrency is an “instrument of economic empowerment” that can help the world participate in finance on a global scale, aligning with its own mission.

Square has a bit of history with the popular cryptocurrency. In January 2018, the company added Bitcoin trading to its mobile payment service Cash App. This past February, the company said half of its Cash App quarterly revenue was now coming from Bitcoin transactions.

Jack Dorsey and company in September launched a cryptocurrency consortium, the Cryptocurrency Open Patent Alliance (COPA), tasked with bolstering innovation by helping individuals and companies create a shared pool of crypto-related intellectual property to defend against patent trolls.

Bitcoin’s value is up around 2.5 percent on the day, presumably as a direct result of Square’s investment. As of writing, a single Bitcoin is trading at $10,985.44, up from the $7,174.74 closing price on January 1, 2020.

Amrita Ahuja , Square’s chief financial officer, said they believe Bitcoin has the potential to be a more ubiquitous currency in the future. “As it grows in adoption, we intend to learn and participate in a disciplined way,” the executive added.

Square’s share value, meanwhile, is up nearly two percent on the day at $183.60 as of writing, up from just $63.83 at the beginning of the year.

Image credit: Jaruwan Jaiyangyuen, Tada Images

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QuantumPhysics

Posts: 3,496   +3,334
Adding bitcoin to your portfolio puts it under unnecessary scrutiny by the IRS. Same goes for any other cryptocurrency. Here in America, crypto is treated with skepticism as if it is being used for nefarious purposes (money laundering).

The reason why companies are buying it, however, is as a speculative asset just in case it ever rises high enough to sell at a profit.

Thing is: despite coronavirus causing worldwide economic depression, recession, inflation on cost-of-living and the halving of bitcoin, it still can't seem to manage to reach its $19,650 high from 2018 - prior to when the US Government (IRS) got involved and started demanding detailed records of crypto trading.

Many Bitcoin-rich fleet to Puerto Rico.
Thanks to Bush's Patriot act, no one can hide their money in international tax havens anymore.
 

Evernessince

Posts: 5,413   +5,998
Adding bitcoin to your portfolio puts it under unnecessary scrutiny by the IRS. Same goes for any other cryptocurrency. Here in America, crypto is treated with skepticism as if it is being used for nefarious purposes (money laundering).

The reason why companies are buying it, however, is as a speculative asset just in case it ever rises high enough to sell at a profit.

Thing is: despite coronavirus causing worldwide economic depression, recession, inflation on cost-of-living and the halving of bitcoin, it still can't seem to manage to reach its $19,650 high from 2018 - prior to when the US Government (IRS) got involved and started demanding detailed records of crypto trading.

Many Bitcoin-rich fleet to Puerto Rico.
Thanks to Bush's Patriot act, no one can hide their money in international tax havens anymore.
Given that every exchange requires ID nowadays and your transactions are on a public ledger, if the government wants to find your crypto money they will.

You'd have to use a peer to peer exchange to get around that. They come with their own risk and are shady IMO. I would never use one for anything over $100.
 

Bulllee

Posts: 43   +16
Forgive my naivety but I thought the basic premise of the blockchain was that it was open to scrutiny until the federal and world banks dipped their dirty toes into the water.
 

NightAntilli

Posts: 380   +320
Adding bitcoin to your portfolio puts it under unnecessary scrutiny by the IRS. Same goes for any other cryptocurrency. Here in America, crypto is treated with skepticism as if it is being used for nefarious purposes (money laundering).

The reason why companies are buying it, however, is as a speculative asset just in case it ever rises high enough to sell at a profit.

Thing is: despite coronavirus causing worldwide economic depression, recession, inflation on cost-of-living and the halving of bitcoin, it still can't seem to manage to reach its $19,650 high from 2018 - prior to when the US Government (IRS) got involved and started demanding detailed records of crypto trading.

Many Bitcoin-rich fleet to Puerto Rico.
Thanks to Bush's Patriot act, no one can hide their money in international tax havens anymore.
I definitely don't understand the logic that 'despite' an economic depression / recession/ cost of living, bitcoin somehow can't reach its all time high. That is quite logical. All those things contribute to people requiring more money, I.e. they will use their savings and investments, meaning they are willing or required to sell their assets at relatively low price to survive.

There is one reason governments are cracking down on bitcoin and other cryptocurrencies; they are threatened that their own institution will become obsolete. They can crack down on it as much as they want; it's not going to die.

More importantly, there is no currency in the world that is used more for money laundering than the US dollar. Let the government do its thing. They are now trying to crack Monero, because it offers privacy while sending crypto anonymously. Let them demand what they want. They will have to realize at some point that it's pointless. The best time to buy bitcoin was yesterday. The second best time is now.
 

Aryassen

Posts: 81   +81
I miss the 2017 speculation that Bitcoin would be $100,000 by now.

Wanna buy some Dave & Buster's Tokens with a small markup?
:)
BTW, in 2017, one of my colleagues invested in BC and hoping it will climb to $2500, asking what do I think about it. I have said I wouldn't touch it with a bargepole, and that I hope he will not lose any money. He laughed at me, and said "you will see".
Well, I saw all right, a mere 18 months later it was close to 20K...I couldn't believe it. But hey, good for him, right? :).

I still reject BC in my portfolio (I find it a bit too speculative, and therefore too high risk for my appetite). I can't tie its volatility to anything, and I'm not convinced by its "missioin" either. In its current form, it is just another speculative asset, and not a revolutionary solution (to a non-existent problem, btw), burning up real resources.

If Square decided to buy BC, I think it is just a speculative investment move (and that's absolutely fine), and at 1% it probably doesn't represent a huge risk to their portfolio either. I don't see it as a statement that they firmly believe in BC (then I think they would have spent much more on that), it's more like a gesture (maybe to raise attention, and thus raise the price, and thus help themsleves a bit too, who knows?)
 
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QuantumPhysics

Posts: 3,496   +3,334
:)
BTW, in 2017, one of my colleagues invested in BC and hoping it will climb to $2500, asking what do I think about it. I have said I wouldn't touch it with a bargepole, and that I hope he will not lose any money. He laughed at me, and said "you will see".
Well, I saw all right, a mere 18 months later it was close to 20K...I couldn't believe it. But hey, good for him, right? :).

I still reject BC in my portfolio (I find it a bit too speculative, and therefore too high risk for my appetite). I can't tie its volatility to anything, and I'm not convinced by its "missioin" either. In its current form, it is just another speculative asset, and not a revolutionary solution (to a non-existent problem, btw), burning up real resources.

If Square decided to buy BC, I think it is just a speculative investment move (and that's absolutely fine), and at 1% it probably doesn't represent a huge risk to their portfolio either. I don't see it as a statement that they firmly believe in BC (then I think they would have spent much more on that), it's more like a gesture (maybe to raise attention, and thus raise the price, and thus help themsleves a bit too, who knows?)


Anyone who got an early before bitcoin hit $5000 has made out pretty well.

The problem is all of the new money needed so that the old money can sell out of their positions.

This is nothing more than a digital Ponzi scheme at this point. The old money is sitting back and waiting for events just like this where corporations and rich people buy large amounts of bitcoin and drive the price up so that they can sell out of it. The halving was a great chance for them to sell out and they did - as many of them could as possible.

So now the new people who bought in have to do something to convince newer people to buy in.

They are all over YouTube and Facebook trying to convince people that it’s a good idea.
 

NightAntilli

Posts: 380   +320
Anyone who got an early before bitcoin hit $5000 has made out pretty well.

The problem is all of the new money needed so that the old money can sell out of their positions.

This is nothing more than a digital Ponzi scheme at this point. The old money is sitting back and waiting for events just like this where corporations and rich people buy large amounts of bitcoin and drive the price up so that they can sell out of it. The halving was a great chance for them to sell out and they did - as many of them could as possible.

So now the new people who bought in have to do something to convince newer people to buy in.

They are all over YouTube and Facebook trying to convince people that it’s a good idea.
You just described pretty much every market cycle ever.
 
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Endymio

Posts: 603   +490
Thanks to Bush's Patriot act, no one can hide their money in international tax havens anymore.
You mean the Patriot Act that Obama pledged to repeal as soon as he was elected, and instead not only renewed it, but strengthened its provisions? You're right; very disappointing.

Bitcoin...is nothing more than a digital Ponzi scheme at this point.
You're trying to treat cryptocurrencies as investments. While many people may buy them for that purpose, they are not intended as such. They are currencies ... and, as such, the more stable their value, the better they serve their purpose.
 

QuantumPhysics

Posts: 3,496   +3,334
You mean the Patriot Act that Obama pledged to repeal as soon as he was elected, and instead not only renewed it, but strengthened its provisions? You're right; very disappointing.

You're trying to treat cryptocurrencies as investments. While many people may buy them for that purpose, they are not intended as such. They are currencies ... and, as such, the more stable their value, the better they serve their purpose.

I said Bush. I meant Bush.

As for cryptocurrency...

Cryptocurrency doesn’t have its own value. It is valued against a real currency such as The DOLLAR, Yen, Yuan, etc.

There is no country that pays workers and collects taxes in “Bitcoin”.

Bitcoin must be converted first into a real currency.

Even Gold and Silver have a history of being currency that Bitcoin won’t ever.

It’s a speculative asset that stops existing when the electricity goes out.
 

Endymio

Posts: 603   +490
I said Bush. I meant Bush.
But the Patriot Act had expired -- until Obama renewed it. And Joe Biden was one of the original authors of the bill -- according to Joe himself, at least. So why focus on Bush?

Cryptocurrency doesn’t have its own value. It is valued against a real currency such as The DOLLAR, Yen, Yuan, etc. There is no country that pays workers and collects taxes in “Bitcoin”. Bitcoin must be converted first into a real currency.
You have conflated currency in general with national currencies. One is a subset of the other. Throughout history, there have been many currencies which not been government-issued, and today bitcoin indeed has "real value"; there are people who pay and are paid directly in bitcoins, without ever converting them into national currencies.
 
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QuantumPhysics

Posts: 3,496   +3,334
But the Patriot Act had expired -- until Obama renewed it. And Joe Biden was one of the original authors of the bill -- according to Joe himself, at least. So why focus on Bush?

You have conflated currency in general with national currencies. One is a subset of the other. Throughout history, there have been many currencies which not been government-issued, and today bitcoin indeed has "real value"; there are people who pay and are paid directly in bitcoins, without ever converting them into national currencies.

#1 Bush’s Patriot Act

#2. Bitcoin has no intrinsic value whatsoever.
 

Endymio

Posts: 603   +490
The US Dollar has a military, prison, postal and school industrial complex behind it. What does Bitcoin have?
That's just it! Yes, when comparing the stability of Bitcoin to the US dollar, Bitcoin loses badly. But when comparing Bitcoin to, say, the Venezuelan bolivar, I'd give the former a slight edge. Or how about the Zimbabwean dollar, which inflated some 80 sextillion percent in a single year? (no, I'm not making that up.) Would you have rather held those dollars or Bitcoins at that particular point in time?

When you're in Venezuela or Zimbabwe during a period of economic crisis, you may not be able to convert your currency into US dollars ... indeed, governments often ban the ability of private citizens to do just that. Bitcoin may then be your only option for a stable value store.
 
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treetops

Posts: 3,041   +768
Bitcoin is taxed.... Its value unlike paper is the encryption? I wouldn't doubt a military would protect a source of revenue. Btw does anyone own a 3080 card with proof?
 

Karlos95

Posts: 117   +40
Wow, everyone commenting on BTC being "speculative" or "volatile" really has no clue what they are saying.

Best long term investment in the last 10 years. Huge gains if you held for long. If you bother to research and look at graphs you can see an uptrend. A bit like gold.

Sure, if you want to jump in and out of the investment short it is very risky. But a lot of people are long term investors and guess what, nothing has beaten it in the last 10 years.

Also note. 20% of your beloved USD was created in 2020. Yeah, that is a very sustainable currency that won't take on even more inflation SMH.

Ignorance is bliss.
 
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Endymio

Posts: 603   +490
Wow, everyone commenting on BTC being "speculative" or "volatile" really has no clue what they are saying. [Bitcoin is] a bit like gold."
No, nothing like gold. Gold never loses 50% of its value within a few days, nor does it double in value equally fast. Bitcoin embodies volatility. Even this year -- one of its most stable -- it has been several times as volatile as gold. Another immense difference between the two is that gold as a commodity has intrinsic value, whereas Bitcoin does not. Gold has thousands of uses that do not depend on it being a medium of exchange; Bitcoin has none.

@QuantumPhysics and I may disagree on other issues, but he is perfectly correct on this. Bitcoin can be favorably compared to certain fiat currencies around the world, but should never be compared to gold.