Jack Dorsey led payment startup, Square, in its recent shareholder letter has announced that it made $2.72 billion from Bitcoin in the second quarter of this year.
Per the letter, the firm’s peer-to-peer payment services, Cash App, had a 200% increase in its Bitcoin revenue. The firm wrote that “$2.72 billion of bitcoin revenue and $55 million of bitcoin gross profit during Q2, each up approximately 3x year over year,” we’re generated through the services.
However, when this performance is compared to the first quarter of the year, it can be seen that the firm’s gross profit and Bitcoin revenue regressed from $3.5 billion. Square blamed the decline on the performance of the crypto market during the second quarter.
According to the fintech company, the drop in its revenue was “driven primarily by relative stability in the price of bitcoin, which affected trading activity compared to prior quarters.”
Away from this, Square also revealed that it suffered an impairment loss on its Bitcoin holdings. The firm reported a loss of around $45 million.
Notably, the firm is not the only one to have suffered this impairment loss during this period. Leading electric car maker, Tesla, alongside Meitu, a Chinese company, and Microstrategy have all announced impairment losses of their own during their Q2 report.
It would be recalled that the price of Bitcoin and other crypto assets suffered huge dips during this period. The flagship cryptocurrency, BTC, saw its price drop from as high as over $60,000 to around $30,000 during this period. This played a critical role in the losses the firms experienced during this period.
But despite these losses, Square’s total investment in BTC stands at $281 million as of June 30, which it wrote is “$127 million greater than the carry value of the investment.”
The fintech company has made several announcements in recent times about critical Bitcoin innovations it is working on. The firm’s CEO has spoken about bringing Defi to Bitcoin and also about the development of a Bitcoin hardware wallet. This, he posits would help to drive Bitcoin adoption and also make “Bitcoin custody more mainstream.”