Square, a payment company, has added $170 million bitcoin's to its crypto holdings.
Square, a company payment service and a significant competitor to PayPal, disclosed on Wednesday that it's recently invested in bitcoin. The company is run by Twitter's CEO and crypto enthusiast, Jack Dorsey.
Major Signals
- Square, a payment company, has added $170 million bitcoin's to its crypto holdings.
- The news bitcoin's price out of its recent steep decline and above $51,000.
- The $170M investment purchased about 3,318 BTC, each acquired at the average rate of $51,235 for one BTC. This is not their 1st venture into crypto. Last year, they also made a $50 million investment in cryptocurrency.
The recent $170M investment purchased about 3,318 BTC, which means that they acquired at the rate of $51,235 for one BTC. The company revealed during the announcement that this current investment, together with the company's former acquisition of $50 million in bitcoin, symbolizes roughly 5% of the company's total cash, cash equivalents, and marketable securities as of the 31st of December 2020.
This week, bitcoin had been in a significant correction, after it entered the week in a.new high. It retracted all the way from its high at the $58,000 level to dip even below the $49,000 level. In fact, some analysts expected it to go much lower as the BTC turned bearish and many whales took profit.
Bitcoin gained by about 5% after the news was released and rallied to climb above $51,000, reaching its peak at $51,398 before a slight retracement.
An analyst pointed out that the big corporations' recent buy-in into Bitcoin showed the change in retail traders' trend. More of them were willing to buy and hold instead of buying to sell. More of these traders were also keen to stake their crypto. They were tying down their crypto stashes in decentralized finance pools as collateral to earn yields. He also said that if this trend continues, then it indicates that bitcoin volume available for willing buyers on exchanges will dry up. This, in turn, will create scarcity, demand pressure, and then ultimately, higher prices.
What do you think of this development? Let us know your thoughts in the comments.
