Financial services company Block, Inc. (SQ), co-founded by tech mogul Jack Dorsey, has made a name for itself in the world of cryptocurrency by holding a substantial amount of Bitcoin on its balance sheet. This commitment to Bitcoin goes back to October 7, 2020, when Block acquired 4,709 Bitcoins for a total of $50 million, a purchase that marked the beginning of their Bitcoin investment journey.
This initial purchase was just the first step in a bold strategy. Block doubled down on its Bitcoin investment in February 2021, acquiring another 3,318 Bitcoins for a total of $170 million. This aggressive approach has paid off for Block, with the company reporting a total of 8,211 Bitcoins on its books as of June 30, 2024. At the current market value, these Bitcoins are worth a hefty $511.29 million, representing a paper profit of over $279.89 million (over 120%) against its initial cost basis of $231.4 million.
Block’s commitment to Bitcoin goes beyond just holding it for potential profits. The company explicitly states that it holds Bitcoin for “long-term investment purposes” and to facilitate transactions through its popular “Cash App” digital wallet service. To further solidify its commitment to Bitcoin, Block announced a new strategy in April 2024, whereby they will allocate 10% of their monthly Bitcoin-related gross profit to purchase more Bitcoin. This approach, according to Block, is designed to minimize the market impact that often accompanies large, one-off purchases.
Block’s dedication to Bitcoin, combined with its innovative strategy of using a portion of its profits to acquire more Bitcoin, showcases the company’s belief in the long-term potential of this cryptocurrency. As Bitcoin continues to gain momentum in the financial world, Block’s significant investment and strategic approach to managing its Bitcoin holdings position them as a leader in the cryptocurrency space.
