Square invests 50 Million in Bitcoin

CEO Jack Dorsey invests 1% of total assets into bitcoin

Dear Investors,

*Disclaimer: Square and Bitcoin are two of my largest financial holdings.*

Square invested $50 Million or 1% of their total assets into Bitcoin. This allowed them to purchase around 4,709 bitcoin. This is huge for many reasons, but it follows the lead of Microstrategy, a company that purchased approximately $425 million of Bitcoin to put on the company’s balance sheet a few weeks ago. Both companies simply see Bitcoin as the better place to put their money besides the United States Dollar. I believe that Bitcoin will be at $100,000 by December 2021. I am not an accountant, but you can do the math. A simple explanation of bitcoin is digital gold. I believe that bitcoin is the greatest investment opportunity of our life, and I don’t care how old or young you are.

Who is Jack Dorsey?

Jack Dorsey is the most underrated figure in Silicon Valley aka the most underrated person in all of technology. (With Chamath being a very close second.) Jack is the CEO/Founder of Twitter and Square, but I personally believe that Square will have a bigger impact on this world than twitter will. Jack works between 80-120 hours a week sharing equal time between both companies. Jack has been a huge supporter of bitcoin for years, tweeting on the subject two weeks ago, saying in part, "#Bitcoin (aka “crypto”) is direct activism against an unverifiable and exclusionary financial system which negatively affects so much of our society.” Jack has been a staunch supporter of bitcoin for a very long time. His twitter bio says one word and one word only: “bitcoin.”

What is Square and Cash App?

Square was started in 2009, and it was formed so merchants could easily take mobile credit card payments. They have had massive growth since 2009, and they now offer a plethora of products. On November 19, 2015, Square's shares began trading on the New York Stock Exchange for $9 per share, with a company valuation of $2.9 billion.2 By Oct. 11, 2020, Square's market capitalization grew to over $66.5 billion and traded above $181 per share. Square owns cash app, and this is going to be a huge part of the future for Square. You can even buy bitcoin on Cashapp. I personally believe that the Generations behind Millennials will use Cash App to bank, get loans, buy bitcoin, and send peer to peer payments.

Why did Square buy bitcoin?

The press release included this line: “Square believes that cryptocurrency is an instrument of economic empowerment and provides a way for the world to participate in a global monetary system, which aligns with the company’s purpose.

They went on to add these comments:

We believe that bitcoin has the potential to be a more ubiquitous currency in the future,” said Square’s Chief Financial Officer, Amrita Ahuja. “As it grows in adoption, we intend to learn and participate in a disciplined way. For a company that is building products based on a more inclusive future, this investment is a step on that journey.”

Square has previously invested in bitcoin from a product, leadership, and legal innovation perspective, and today adds this financial investment. The company launched bitcoin trading in 2018 with Cash App, which enables the buying and selling of bitcoin. In 2019, the company formed Square Crypto, an independent team solely focused on contributing to bitcoin open-source work for the benefit of all, and also recently launched the Cryptocurrency Open Patent Alliance (COPA), a non-profit organization encouraging crypto innovation and opening access to patented crypto inventions.

Square is making the decision that every company (large and small) is going to be forced to make. We have a 0% interest rate environment and a Federal Reserve that is wanting high inflation levels moving forward. This means you will literally lose money if you are sitting on a lot of cash in your bank account.

We will begin to see more and more companies buy bitcoin, but the main question is are you?

Stay Hungry, Stay Foolish,

Matt Allen


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