Square announced Thursday that it has purchased approximately 4,709 Bitcoins at an aggregate purchase price of $50 million. Yahoo Finance’s Dan Roberts joins The Final Round panel to break down why Square invested in the cryptocurrency.
JEN ROGERS: Square going out and buying $50 million in Bitcoin. It's funny, in our story document, it says investing. But I don't know. Is this an investment? What is this? I mean, what are they doing? He's obviously made big bets on Bitcoin before, but why right now? It's high. Could have done it another time.
DAN ROBERTS: Well, if you're Jack Dorsey, you think it's going to go higher, don't you? Dorsey loves Bitcoin. And the company has taken on his love of Bitcoin. Everyone says in cryptocurrency, but really, it's just Bitcoin. I think Jack Dorsey is a Bitcoin maximalist, honestly, although that's become a little bit of a controversial term.
It's interesting. In Square's most recent earnings, you saw that revenue from Bitcoin was way up. Profit was way up, although that profit was still in the single millions of dollars. Very small potatoes for Square, but worth noting much better than in the past because of the demand for Bitcoin trading.
It was back in 2018 that Square added that functionality to its Cash app, but actually, it took until last year for Square to actually launch a division within Square that I believe is called Square Crypto. So they've now got people dedicated to what exactly? Mm, exploring the future of cryptocurrency.
Now the company is buying Bitcoin as a reserve. It also has to own some, obviously, to allow and facilitate trading on the Cash app. But this is something new. And Dorsey has also launched a number of open initiatives. He's talked about wanting Twitter to be decentralized and to use some kind of blockchain format to decentralize it and make Twitter and other social media efforts more secure.
So he's certainly interested in this. He's dipping a toe in. The crypto people love it, and they're excited about it. What does it all mean for Square as a company, which really does, you know, a small business point of sale software and also does loans now to small businesses? Probably still, for the time being, very little. But it gets them the attention of the crypto community. And Jack Dorsey has definitely been a friend to Bitcoin.
JEN ROGERS: Certainly getting a lot of attention today. That is indeed the case. All right, Dan Roberts with the flashback to the crypto corner.