Bitcoin-Friendly Square Cash App Stock Price Up 56% In 2019 (#GotBitcoin?)
Cash App, they payments app of San Francisco-based payments company Square, announced a Bitcoin (BTC) giveaway in a tweet published on July 26 as its stock price continues to grow, according to MarketWatch. Bitcoin-Friendly Square Cash App Stock Price Up 56% In 2019 (#GotBitcoin?)
Giving Away Bitcoin
In its tweets, the official Cash App Twitter account announced that it will give away $50,000 in Bitcoin. In subsequent tweets, Cashapp also pointed out that the number of tweets grew first to 12,300, and then to 40,300.
As Cointelegraph reported at the end of June, Square already enabled Bitcoin deposits to all of its Cash App users. Notably, Square’s founder Jack Dorsey — who is also the creator of Twitter — has been putting together a team dedicated to improving crypto infrastructure in general.
Square Is A Growing Company
Furthermore, Square’s (SQ) stock is up about 56% in 2019, having started the year at $57.2 and trading at $81.8 at press time, according to MarketWatch data. Bitcoin, on the other hand, increased its value by about 157% over the same period, according to Coin360.
As Cointelegraph reported earlier today, the Chinese central bank released on its website an infographic illustrating what is Bitcoin, how it works, and why it’s valuable.
Square Doubles Bitcoin Revenue, Generating $125 Million via Cash App in Q2
Payments company Square has generated $125 million in Bitcoin (BTC) revenue in the second quarter of 2019 through its mobile payments service Cash App.
Square released the information in the company’s Q2 2019 shareholder letter on Aug. 1. According to the letter, the company’s Bitcoin revenue benefited in part from the number one cryptocurrency’s price rally over the quarter.
As a result of this price growth, there was also a correspondingly increased volume of Bitcoin, they say. This resulted in a $2 million gross profit for the company.
Cash App obtained $135 million in subscription-, services- and transaction-based revenue. This means that Bitcoin revenue granted the company over 92% of the quantity that Square obtained through subscription, services and transaction revenue alone.
In Square’s Q1 2019 report in May, the company revealed that it achieved a new revenue high from Bitcoin sales via Cash App, with a stated Bitcoin revenue of $65.5 million. This means Square has more than doubled its Bitcoin revenue compared to the preceding quarter.
Square: A Company Bullish On Bitcoin
As previously reported by Cointelegraph, Steve Lee, a project manager at Square’s crypto branch — Square Crypto — heavily emphasized the company’s belief in Bitcoin in an ask me anything session on Twitter. Lee wrote that the company was “very, very pro-Bitcoin.”
Square also recently released a Bitcoin deposits feature on Cash App in late June. This reportedly enables Bitcoin users to deposit their assets from external wallets into Square’s payments application. However, the announcement cautioned that there would be some limitations — a cap of $10,000 in Bitcoin per seven days, and a wait of up to several hours to confirm the deposits via blockchain.
Square’s Cash App Is Testing a Stock Trading Feature
Square’s cryptocurrency-friendly payment app Cash App is reportedly testing a new feature allowing customers to buy and sell stocks.
Expanding Cash App
Citing a source familiar with the matter, Bloomberg reported on Sept. 12 that the San Francisco-based startup’s employees began testing the new feature in recent weeks. Once released, it will allow Cash App users to make free stock trades.
Square has reportedly not yet determined the exact date of the new option launch.
Cash App And Crypto
Square made Bitcoin (BTC) deposits available on Cash App in late June. At the time, deposits were limited to $10,000 worth of Bitcoin in a seven day period, while transfers could take several hours to be confirmed on the blockchain.
In July, Cash App announced a giveaway of $50,000 worth of BTC following the continued growth of its stock price. At the time, Square’s stock was up about 56% in 2019, having started the year at $57.2 and trading at $81.8 at the time, according to MarketWatch data.
Bitcoin, On The Other Hand, Increased Its Value By About 157% Over The Same Period.
Jack Dorsey And Crypto
Also this summer, Square’s founder Jack Dorsey — who is also the creator of social media giant Twitter — was putting together a team dedicated to improving crypto infrastructure in general. Back then, Dorsey commented on the advantages for Square too, saying:
“Just from a business perspective, we don’t look like an Internet company today. An Internet company can launch something and it’s available around the world. Whereas with payments, you have to go to each market and pay attention to regulators. You need a partnership with a local bank. This is a very slow process in any new market.”
Square Crypto Grants $100,000 To Open-Source Crypto Payment Processor
Bitcoin (BTC)-supporting payments service Square Crypto is giving the first of what will be many grants to support open-source Bitcoin projects to BTCPay Foundation.
BTCPay Receives $100,000 Grant
On Sept. 14, Square Crypto, the crypto-focused branch of mobile payment company Square, took to Twitter to announce that it is providing BTCPay Foundation with a grant of $100,000 to support BTCPay Server, an open-source cryptocurrency payment processor.
BTCPay Server can allocate the funds to create anything, “as long as it’s free and open-source software that improves the security, scalability, privacy, user experience, or fungibility of Bitcoin — or all of the above.” The Square Crypto team added:
“BTCPay represents everything we love about open-source bitcoin projects. It exemplifies the ideals of our community and promotes adoption by letting merchants accept bitcoin, control their private keys, and self-validate their coins. It also creates powerful real world applications for bitcoin without sacrificing user experience or requiring trusted third parties.”
Square Crypto went on to explain why they are giving a “bunch of money” to BTCPay Server, a product that appears to be in direct competition with its own services. Square explained:
“Existing payments companies have a choice to make: adapt or be left behind. This isn’t an investment in a competitor, it’s an investment in the future of money — something that Square obviously has a stake in.”
Square And BTC Infrastructure
As Cointelegraph reported at the end of July, project manager at Square Crypto Steve Lee emphasized in a Twitter ask me anything that his team is particularly keen on developing support for the Bitcoin ecosystem. He added:
“We are very, very pro-Bitcoin. There is more than enough work for us to do there. That said, we are open to emerging use cases and technologies that complement Bitcoin.”
Bitcoin Buyers for Square’s Cash App Doubled in Q3 2019
According to its Q3 2019 shareholder letter, Square’s Cash App reported many new first-time Bitcoin (BTC) buyers, but low profits related to its Bitcoin business.
On Nov. 6, payment processing giant Square issued a letter to shareholders outlining Q3 2019 financial figures, in which it disclosed that the total net revenue for its Cash App was $307 million, while the gross profit resulted in $123 million for Q3.
First-time BTC Buyers Have Almost Doubled
Square’s Cash App saw $148 million in Bitcoin revenue. However, the company endured a whopping $146 million in Bitcoin costs during the third quarter of 2019, which resulted in only $2 million profit on Bitcoin sales during the same time period.
Despite the low profit margin on BTC sales, more and more users are apparently finding their way to the Square’s Cash App as a means to invest in Bitcoin. Ever since the company introduced the redesigned Cash App’s customer interface, product adoption of Bitcoin and Cash Card has increased significantly. The letter stated:
“First-time Bitcoin buyers have approximately doubled and Cash Card orders have seen a meaningful uplift.”
The shareholder letter further points out that in the third quarter of 2019, total net revenue grew 44% year-over-year to $1.27 billion, and adjusted revenue grew 40% year-over-year to $602 million.
Net income was $29 million in the Q3 2019, compared to a net income of $20 million in the Q3 2018.
The Cash App, Square’s popular payments app, was initially designed to facilitate the transfer of fiat currency but soon started supporting cryptocurrency trading.
Square’ Cash Card is a free business debit card that enables sellers to spend their funds as soon as they make a sale. When a seller takes a payment, the proceeds immediately go into their Square stored balance, which can then be spent or withdrawn from an ATM.
Buy A Fraction Of Berkshire Stock
Square App has continued to expand beyond its initial purpose as a payments app. Recently, Jack Dorsey, CEO of Twitter and Square, announced that Square’s Cash App is poised to enable users to purchase fractions of stocks — with an entry of as little as $1. Dorsey wrote:
“Now anyone can buy $42 or even $1 worth of Berkshire Hathaway A ($BRK.A, or $TSLA or $SFIX or…) instantly and for free right in @CashApp. Really proud of the team for making buying stocks and building wealth accessible to more people. Rolling out now!”
Dorsey also pointed out that users who are not into stocks can buy fractions of Bitcoin using the same interface.
Jack Dorsey’s Square Awarded Patent For Real-Time Crypto-To-Fiat Swaps
Financial services and mobile payment company Square thinks it has found a way to turn fiat into crypto in real-time point-of-sale transactions.
How It Works
On Jan. 21, the United States Patent Office awarded Square a patent for a technology that the team argues cracks a present barrier in merchant transactions:
“All cryptocurrencies face the same drawback in that they are not widely accepted. Presently, cryptocurrencies, like bitcoin, are not accepted by most retail merchants, or even by most online merchants.”
The team cited a number of drawbacks to current crypto spending. Transactions take a while to process. Minor advances still defy practical timeframes, like buying a hypothetical cup of coffee in a transaction that the blockchain could take hours to record.
The anonymity of cryptocurrencies exposes merchants to possible criminal activity, like money laundering. There’s also the purely money angle, as the fluctuation of crypto exchange rates poses a financial risk to business owners.
But let’s say a consumer purchases that cup of coffee. The technology would receive a request for payment in the consumer’s asset-of-choice — while using a privacy coin — and approve it for the merchant to get full value in their asset-of-choice, all in real-time.
Cointelegraph reached out to Square about the technology’s possible usage across point-of-sale devices, but a spokesperson declined to confirm a specific pending usage for the newly patented system.
On Jan. 21, Square announced on its blog the start of a Lightning Development Kit (LDK). Larger than a node, LDK would customize experiences for wallet and application developments, including an API, language bindings and demo apps. The shaky structure of Lightning as is, the blog argues, is just that — shaky. Improvements, however, would lead to low-fee Bitcoin payments “as common as cash used to be.”
Square Lowers Its Q1 Estimates by $800M Despite Bitcoin Success
Square’s Bitcoin (BTC) revenue continues to grow, even as the popular payments app lowers its first-quarter revenue estimates by $800 million due to the coronavirus crisis.
According to a company announcement on March 24, COVID-19 was not a factor in the company’s growth until around 10 days ago:
“While the beginning of March was relatively in line with the company’s expectations, over the trailing ten-day period Seller GPV [gross processing volume] has declined by approximately 25% year over year, with greater declines in recent days.”
This resulted in Square revising its first-quarter total net revenue from an estimate of $1.3–1.344 billion to the $515–$525 million range. The company was also forced to withdraw its full-year 2020 guidance, and “expects to provide a further update on its first-quarter 2020 earnings call in May.”
Square’s CashApp supports Bitcoin transactions and generates significant revenue for the company. In the fourth quarter of 2019 alone, the service generated $178 million.
Despite the company’s struggles and the latest economic downturn, CashApp has seen increased adoption and investments in Bitcoin, according to the company’s spokesperson. Meanwhile, Square’s stock was up 15.75% on the day.
The company’s updated revenue outlook seems to support the idea that as the global economic panic deepens, more investors may seek shelter in Bitcoin.
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