Buy on the dip! Square invests another $170 million to buy Bitcoin, what is its average price?

Square held a conference call on the 23rd to announce its performance for the fourth quarter and full year of 2020, as well as the news of purchasing $170 million worth of Bitcoin. Previously, Square had initially invested $50 million in October last year.

Accounts for 5% of Square's Total Assets

In early October last year, reports emerged that Square had invested $50 million to acquire 4,709 bitcoins, representing about 1% of its total assets at the time.

According to the latest announcement from Square, it has once again purchased bitcoins worth $170 million, approximately 3,318 bitcoins, accounting for 5% of Square's total cash, cash equivalents, and securities. The announcement stated:

This investment is in line with the company's purpose, as Square sees cryptocurrency as an economic empowerment tool that provides individuals with a way to participate in the global monetary system. Square will continue to assess its overall investment in Bitcoin.

Strong Push for Bitcoin Adoption

In its fourth-quarter shareholder letter, Square mentioned its continued focus on optimizing the accessibility of Bitcoin for users of Cash App, a product under Square. Unlike exchanges, Cash App focuses more on simplifying the process for users to buy and sell Bitcoin, settle transactions with Bitcoin, and transfer funds using Bitcoin.

The letter also stated:

We have reached a milestone in the adoption of our Bitcoin product with over 3 million users buying and selling Bitcoin through Cash App last year, a 2.5x increase from the same period in 2019. Just in January 2021, over 1 million users have made their first purchase of Bitcoin.

Additionally, in December last year, Square announced its Bitcoin clean energy investment initiative with the goal of achieving zero carbon emissions by 2030.

Fourth in Bitcoin Holdings

According to data from Bitcointreasuries, Square currently ranks fourth in terms of holdings, with the top three being MicroStrategy, Tesla, and the crypto investment firm Galaxy Digital.

This move has increased Square's Bitcoin holdings to 8,027 bitcoins, approximately half of Galaxy Digital's holdings. The average purchase price this time is around $51,235.

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