Block Allocates 10% of Bitcoin Earnings for Monthly BTC Buys
Mitchell Nixon
Block to Allocate 10% of Bitcoin Product Profits
Jack Dorsey, the co-founder of Twitter, announced that his financial technology company, Block, Inc., will allocate 10% of its gross profit from Bitcoin products towards purchasing Bitcoin (BTC) every month.
“Going forward, each month we will be investing 10% of our gross profit from Bitcoin products into Bitcoin purchases,” Dorsey stated in a shareholder letter accompanying the company’s first-quarter results, which exceeded expectations.
“We were one of the first public companies to put Bitcoin on our balance sheet,”” he continued. Block acquired $220 million worth of BTC between Q4 2020 and Q1 2021.
“Our investment in Bitcoin transcends technology; it is an investment in a future where economic empowerment is the norm.”
Block’s Impressive Bitcoin Holdings and Revenue Growth in Q1
The latest earnings report revealed that Block held 8,038 BTC as of March 31, valued at $573 million, with reported unrealized gains of $233 million.
In the first quarter of 2024, Block’s Bitcoin gross profit from customer sales via its Cash App business surged by almost 60% year-on-year, reaching $80.1 million. At the current price of $59,250 per Bitcoin, this profit could potentially acquire around 1,350 BTC.
Furthermore, Block’s Bitcoin revenue, representing the total value of Bitcoin sold to its customers, increased by 26% year-on-year to $2.73 billion in Q1. This growth was attributed to the rising average market price of Bitcoin throughout the quarter.
Dorsey Highlights Bitcoin’s Global Potential
In his shareholder letter, Dorsey emphasised his significant focus on Bitcoin, stating his belief in the necessity of an open protocol for money worldwide. He suggested that such a protocol could accelerate Block’s ability to reach more people globally.
However, Dorsey noted that despite his personal attention to Bitcoin, less than 3% of the company’s resources are dedicated to Bitcoin-related projects. Despite this, Block introduced its Bitkey Bitcoin wallet in December and announced plans on April 23 to develop a comprehensive Bitcoin mining system to support miners post the Bitcoin halving, which reduced rewards by 50%.
Dorsey concluded by expressing his conviction that the internet will eventually adopt a native currency, although this transition will take time, with existing and emerging financial systems operating concurrently.
Conclusion:
Block’s commitment to investing 10% of its Bitcoin earnings into monthly BTC purchases underlines the growing importance of Bitcoin in today’s financial landscape. As Jack Dorsey and Block continue to push the boundaries of Bitcoin adoption, it’s clear that the potential for Bitcoin mining, profitability, and bitcoin investment remains significant.
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