Bitcoin is powering a Fintech giant’s revenues for this quarter, data released on Thursday showed.
Cash App, the American financial services company that operates Bitcoin purchase app Square, reported in a US SEC filing yesterday that its Bitcoin business outnumbered any other purchases made in the third quarter of 2020. The mobile app functions as a broker for Bitcoin, stocks, and crypto purchases, holding a user’s private keys and allowing transfers to other Cash App customers.
Square’s total Q3 revenue reported at $3 billion, an increase of 140% compared to last year. Of this, Bitcoin purchases made for over 50%, compared to 2019 when users just brought $338 million worth of the asset and Square made a gross profit of $5 million.
Bitcoin made 80% of Square revenue
The revenue is a ten-fold increase compared to the same quarter last year when the crypto market was still bearish and saw relatively lesser interest among the retail crowd.
Bitcoin made over 80% of Square’s entire revenues, with Cash App users purchasing over $1.63 billion worth in Bitcoin in the past three months, the document showed.
Other products on Cash App generated revenues of over $450 million, indicating the crowd was largely betting on only Bitcoin. The bets seem to have paid off well, with the pioneer cryptocurrency touching a high of $15,850 today — a near 50% increase since May and 300% since a low of $3,900 in March.
Square said users purchasing Bitcoin made use of the Cash App’s “Auto-Invest” tool, an automated service that launched in May 2020 and allows users to stack sats with a fixed amount daily or weekly. This service is also available for stock purchases.
Meanwhile, the firm said its Bitcoin business generated over $32 million in gross profit for the third quarter, a near 15x increase 2019’s profit of $2.1 million in a comparable period.
Square’s Bitcoin bet just made it $74 million
Apart from the revenues generated from Bitcoin, Square also noted its $50 million Bitcoin investment last month was now worth $74.8 million — a 50% profit. As CryptoSlate reported at the time, Square stated that it “expected to hold the investment for a long time” and that “as it grows in adoption, we intend to learn and participate in a disciplined way.”
The investment represented approximately 1% of Square’s total assets as of the end of the second quarter of 2020.