Square’s revenue from its bitcoin business increased 11-fold compared to this time last year.
“Cash App generated $3.51 billion of bitcoin revenue and $75 million of bitcoin gross profit during the first quarter of 2021, each up approximately 11x year over year,” according to a shareholder letter published Thursday.
This doubled Square’s Q4 2020 bitcoin revenue of $1.76 billion. Bitcoin revenue for Q1 2020 was a mere $306 million.
Total revenues in the first quarter of this year were $5.06 billion, meaning bitcoin revenue was 70% of Square’s total consolidated revenue in the first quarter.
In addition to Cash App’s involvement as a mainstream gateway to bitcoin, Square holds a portion of its treasury in the original cryptocurrency.
“In the fourth quarter of 2020 and first quarter of 2021, we invested $50 million and $170 million, respectively, in bitcoin,” Square wrote, adding that it expects to “hold this investment for the long term.”
Due to fluctuations in market prices over the first quarter the company reported a $20 million impairment loss on its bitcoin holdings. Nevertheless, by quarter’s end the value had made a strong gain, reporting a $472 million fair value of its bitcoin on March 31 – $272 million greater than its carrying cost.
This is a developing story and will be updated.
