Dorseys Block to invest 10 Percent of Bitcoin product profits in monthly BTC purchases
Jack Dorsey Block, a financial services and digital payments company, has announced plans to buy Bitcoin monthly with 10% of its gross profit from Bitcoin products. This was revealed on Thursday in its first-quarter earnings report.
block is DCA'ing bitcoin every month. here's how your company can do it too: https://t.co/xabpCVZdn8
— jack (@jack) May 2, 2024
Co-founder Dorsey has consistently praised the flagship cryptocurrency as a major financial innovation, and the company's new investment strategy demonstrates its long-term commitment to it.
Block, formerly known as Square, also said the company's initial bitcoin investment of $220 million has grown by approximately 160% amounting to $573 million at the end of the first quarter of 2024.
Less than 3% of the company's resources are allocated to bitcoin-related projects, according to a statement made by Block Jack Dorsey, who also expressed his belief that bitcoin will "become the native currency of the internet."
"We believe the world needs an open protocol for money, one that’s not owned or controlled by any single entity. We believe bitcoin is the best and only candidate to be that protocol and to ultimately become the native currency of the internet," Dorsey said in the note.
Block's first-quarter gross profit from bitcoin was $80 million, up 59% from the previous year. The company attributed this increase to both the price of bitcoin during the quarter and the appreciation of its inventory.
With strong performance across Cash App Card, the BNPL platform, Bitcoin products, and Cash App Borrow, the company's Cash App unit saw gross profit growth of 25% year-over-year in the first quarter. This growth was mostly driven by inflows per active and monetization rate.
Thursday's after-hours trading saw Block (SQ) shares rise in response to first-quarter earnings that exceeded analysts' projections.
Profits after taxes of $5.97 billion exceeded Wall Street's projected $5.82 billion, and adjusted earnings per share came in 13 cents ahead of the consensus estimate. The first quarter's gross profit increased by 22% to $2.09 billion over the previous year.
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