Square Inc, the company responsible for pioneering mobile payments, recently announced a $50 million investment into Bitcoin (BTC). What does this mean for the finance world, and the future of cryotocurrency?
For one, Squares investment is seen as a strong vote of confidence for the future of bitcoin, and the cryptocurrency market in general. As well as a hint that the mobile payment giant “sees a lot of potential for cryptocurrency as an asset”, reported JPMorgan analysts this past Tuesday.
Square’s $50 million investment is substantial, yet still pales in comparison to other recent crypto acquisitions, like MicroStrategies $425 million pile up of various crypto assets. That being said, Square is likely to make more purchases going forward.
Will crypto finally join the mainstream as a growing segment for payment options? Specifically mobile and in person payments? Other payment companies are likely to follow Square’s lead to not lose out from this growing segment.
Some other important details to note:
- Customers, mostly millennials, have already been using Square’s Cash App to purchase BTC
- Bitcoin’s Q3 demand has exceeded supply at a greater level than Q2
- Option contracts in BTC has risen due to institutions still preferring to deal with established exchanges
- A surplus of long positions for BTC could create a headwind for price in the short term
That all being said, Square’s investment is a strong vote of confidence for the longterm of BTC and crpyto in general, and will be interesting to see if other major payment and fin tech companies follow suit.
