Cash App Recorded 1 Million New Bitcoin Users in January 2021, Adding to its 3 Million Throughout 2020

“We've continued to see strong adoption with 3 million customers across Bitcoin throughout the year for Cash App and in January, saw 1 million new to Bitcoin in the month,” revealed Amrita Ahuja, Chief Financial Officer at Square's Q4 2020 earnings call.

The 4Q20 report divulged a profitable quarter with bitcoin revenue seeing a 785% year-over-year increase.

The company reported $1.76 billion in Bitcoin revenue in the fourth quarter while costs were $1.71 billion. The Bitcoin bull run and growth in bitcoin customers along with volume per customer were noted as the reason behind this increase in revenue.

When it comes to Bitcoin volumes per customer, it increased by more than 2.5x compared to the same period last year, driven by both new and existing customers.

The company raked $4.57 billion in Bitcoin revenue last year with $97 million in gross profit. Revenue from selling BTC on its Cash App actually accounted for 48% of total consolidated revenue in 2020 and 85% of the total increase in consolidated net revenues.

However, it is still in the early days; as Ahuja said, “only about one in 10 customers on Cash App are using the Bitcoin product,” but the company sees “an opportunity to grow that over time.”

The Cash App also launched a Bitcoin Boost where Cash Card customers could get rewards in BTC following the increase in demand for the digital currency. Of those who used Boost, half of them were new to Bitcoin, and nearly a third of them went on to purchase their first BTC in the following month.

In the company's earnings call, Square founder and CEO Jack Dorsey reiterated his views of the internet having a native currency and that it will be Bitcoin.

“Bitcoin has the potential to be a native currency of the internet, and we want to continue to participate and learn in a disciplined way,” said Ahuja.

It was also revealed that Square had increased its Bitcoin bet by purchasing $170 million worth of Bitcoin, 3,318 BTC, on top of its $50 million bought in October. This has raised the company's Bitcoin holdings to about 5% of its cash and equivalents.

“We believe it has the highest probability of empowering more people in the economy in a fair way,” Dorsey added, “by us owning Bitcoin, our incentives are aligned with skin in the game.”

Dorsey, who is also the co-founder and CEO of Twitter, said they are “going to double down on our commitment to Bitcoin.”