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Square buys $ 170 million more in bitcoin to increase cryptocurrency

Square (SQ) announced on Tuesday that it was buying $ 170 million dollars in bitcoin to add to its expanding position.

The new purchase from the payment company now brings its total bitcoin holdings to approx. 5% of its cash and cash equivalents. Average of the 3,318 bitcoins Square says that the purchased would indicate an average price of around $ 51,235 per bitcoin (BTC-USD). The cryptocurrency had dipped below $ 48,000 on Tuesday at the time of Square’s announcement.

“Tailored to the purpose of the company, Square believes that cryptocurrency is an instrument of economic empowerment that enables individuals to participate in a global monetary system and secure their own economic 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 continuously assess its overall investment in bitcoin relative to its other investments.”

Square had previously bought about $ 50 million in bitcoin in October 2020. At that time, the purchase amounted to approx. 1% of the company’s cash and cash equivalents.

In comparison, Tesla’s purchase of bitcoin amounted to 1.5 billion. Dollar ca. 8% of Tesla’s cash when it was announced earlier in February. This position had already swelled by about 1 billion. As bitcoin rose above $ 58,000 to hit a new record high before cryptocurrency collapsed this week down to around $ 48,000. This weekend, Tesla CEO Elon Musk tweeted that the price of bitcoin seemed “high”.

Business intelligence software company MicroStrategy was the first listed company to add bitcoin to its balance sheet last year. Its CEO Michael Saylor told Yahoo Finance earlier this month that other companies would likely follow Tesla and Square to add bitcoin to its cash holdings. He predicted shortly after holding a virtual conference with about 1,000 business executives and just before his company filed to raise more than $ 500 million to buy more bitcoin. Saylor was quick to Twitter to celebrate Jack Dorsey, who led Square to double bitcoin in a Tuesday tweet.

Square shares fell by approx. 5% in post-trade after reporting mixed results. Bitcoin was slightly changed after Square’s announcement and hovered around $ 48,000.

Zack Guzman is an anchor for Yahoo Finance Live as well as a senior writer covering entrepreneurship, cannabis, startups and breaking news at Yahoo Finance. Follow him on Twitter @zGuz.

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