On Tuesday, Square announced it had purchased 3318 BTC additional reserve assets. UnFortunately, this happened shortly before the price plummeted to $48,408, a recovery value after a recorded low of 44,964. This indicates that Square purchased these assets at the time they cost well over $50,000.
The $170 million used in the procurement of these assets is currently worth more than the purchased assets. This is terrible news for Square.
During this dip, Bitcoin critics have targeted crypto currencies. This is because of the mass loss experienced by companies with crypto investments. For instance, Tesla has made a recorded loss of $200 billion and Square recorded at least a $10 million loss.
The main topic amongst critics is Cryptocurrency Volatility. This is the reason why other companies would less likely follow in the footsteps of companies like to Tesla, MicroStrategy and Square, so states analysts rom JPMorgan.
The company had bought about $15 million worth in BTC last October. At the time, this was about 1% of their of the companies to cash and corresponding cash equivalents. This was a great investment choice by the company as currently, that purchase is now worth about $224 million. This makes up a total of about $384 million worth of BTC on the companies balance sheet. This is a very significant gain for Square and I personally command the first bold step they took in buying digital assets last year.
The company holds high standards for digital assets and a growing potential for crypto in the future. They have already professed future plans of expanding in the crypto verse as an institutional investor.
“Aligned with the company’s purpose, Square believes that cryptocurrency is an instrument of economic empowerment, providing a way for individuals to participate in a global monetary system and secure their own financial future,” the company wrote in a press release ahead of its earnings call. “The investment is part of Square’s ongoing commitment to bitcoin, and the company plans to assess its aggregate investment in bitcoin relative to its other investments on an ongoing basis.”
Importantly, although Bitcoin prices plummeted about 5% just hours after Square’ s purchased, I think that this marks the end of the bull run. It is also, the starting of the bulls potentially taking over once again.
