Square’s Bitcoin Backing Pays Off With Bitcoin Sales Up 237%

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Square has been providing Americans with a quick and easy way to buy Bitcoin for years, but things weren’t always this way. There was a period when Square’s Cash App didn’t provide Bitcoin services before Square took a huge gamble – much to the dismay of traditional crypto exchanges – and added Bitcoin trading. This massive gamble has paid off, with Square recording 237% more Bitcoin sales in Q2 of 2019 than it did in the same period in 2018. That equates to a staggering $125 million in Bitcoin sales.

It’s Still Not a Silver Bullet for Square

It’s no secret that Square hasn’t been performing too well, recording net losses for a significant period of time. However, If Bitcoin sales continue to rise, we could see Square record a net profit during Q3. While Square saw $125 million in Bitcoin sales, only $2 million of that was profit. Bitcoin has picked up pace in the last few days, meaning we could very well see more and more users pile into Bitcoin through the Square app. The next move for Bitcoin is still shaky, with a number of different scenarios possible, but if the parabola continues upwards, we could see Bitcoin thrusting itself back towards $15,000.

Bitcoin and Square Merchants?

Back in August 2018, Square won a patent application that would allow merchants to be able to accept Bitcoin as a payment method. It’s well known that Jack Dorsey – Square CEO – is pro-crypto and pro-Bitcoin, but this doesn’t mean that we will see Square merchants begin to accept crypto any time soon. In Germany, a new bill was passed last week that means all private key custodians are required to apply for regulation under the German Federal Financial Supervisory Authority (BaFin), with BitPay already pulling out of the country. This could be a huge market for Square if it can deploy Bitcoin payments as merchants would have access to their own private keys.

Square has a huge potential and can create 2 million merchants around the globe that accept Bitcoin overnight. While not all merchants would choose to accept Bitcoin, simply having that option gives Square a major advantage over its competitors. Square might have profited $2 million from Bitcoin’s recent price hike, but if markets come tumbling down its earnings report for Q3 could make rather dismal reading.

The Bitcoin gamble has paid off so far for Square, but will it continue as the year rolls on? Only time will tell.