Bitcoin (BTC), Cryptocurrency–Despite the crypto markets entering the final months of 2018 in an ongoing bear cycle, cryptocurrency and financial services company Square has revealed that Q3 revenue was up $6 million, including a profit of $500,000. While some investors might find the numbers middling at best, it represents a substantial step forward for cryptocurrency and Bitcoin payments–particularly when the move by Square to implement BTC was viewed by many as a money losing venture.
Square, publishing the numbers in a shareholder letter on Nov. 8, revealed that the BTC division for the payment company has continued to climb throughout 2018, positive news for the industry of cryptocurrency despite the otherwise depressed market valuation. Since adopting Bitcoin as a currency in its payment portal earlier this year, a move that marked the first venture into cryptocurrency for Square, the company has been seen as a crossover between mainstream markets and the relatively untapped potential of crypto. The bump in cryptocurrency revenue to the tune of $6 million was positive news for the company, which is already reporting an increase of 51 percent in total revenue over Q3 of 2017. While some have pointed to the addition of cryptocurrency as providing trivial to profits to Square, if at all, the company reports that the addition of Bitcoin is responsible for 8 percent of the growth over last year’s Q3 numbers, stating:
“Total net revenue was $882 million in the third quarter of 2018, up 51% year over year. This includes $43 million of bitcoin revenue…Excluding bitcoin revenue, total net revenue was $839 million, up 43% year over year.”
Square has continually climbed in both popularity and cultural relevance, as the company provides one of the more simplistic platforms for both merchants and customers to engage in transactions. The addition of Bitcoin is likely in part due to the nature of CEO Jack Dorsey, co-founder and CEO of Twitter, who has expressed extremely bullish remarks for cryptocurrency in the past. Dorsey, who turns 42 later this month, once made the claim that Bitcoin would become the world’s sole currency in the future, a remark that still remains one of the most bullish statements by such a high profile tech industry figure.
Just this week, the market capitalization for Square surpassed that of the social media giant Twitter, marking an interesting moment for Jack Dorsey who helms both ventures. While Bitcoin, and by extension the cryptocurrency division at Square, remains a niche market for the financial services platform, the quarter over quarter increase and revenue for BTC payments is a promising sign for both the company and the broader industry of cryptocurrency.
Some analysts and crypto commentators have bemoaned the focus on third party payment platforms, which obscure the inherent transactional potential of any cryptocurrency. However, a company as large and high profile as Square, with the direct backing of CEO Jack Dorsey, holds overwhelming potential for both Bitcoin and cryptocurrency. Even though BTC can be transacted, bought and sold without the need of a intermediary, it remains beneficial promotion to have the coin partnered with payment protocols that already appeal to Main Street and hold the key to mass adoption.