In an earnings report for the year ended December 31 released overnight on Tuesday, the company said that its Cash App mobile payment service had seen a “significant increase” in revenues over the period, primarily from Bitcoin-related revenues, which contributed 48% of total consolidated net revenue for the year.
The surge was attributed to customer demand for the cryptocurrency amid its surging price, Square said, adding that as such the figure may not be indicative of future performance.
The price of Bitcoin surged over the course of the year as the economic crisis caused by the coronavirus pandemic sent investors searching for assets they believed would serve as better value stores amid the volatility. Over the last 12 months, Bitcoin’s price has risen around 424%.
Square also announced on Tuesday that it has purchased an additional 3,318 Bitcoin, worth around US$170mln, to add to its treasury following its purchase of 4,709 Bitcoin in October last year for around US$50mln.
The company appeared to be taking its lead from electric car maker Tesla Inc (NASDAQ:TSLA), which earlier this month unveiled a US$1.5bn Bitcoin investment, showing that its billionaire boss Elon Musk had finally put his money where his mouth is after multiple positive comments around the virtual currency.
Shares in Square were down 2.9% at US$249.05 in pre-market trading in New York on Wednesday, while Bitcoin was up 8.4% at US$50,857 over the latest 24-hour period.