SAN FRANCISCO, Monday, May 13, 2024 – Financial services and payments company Block Inc. (SQ), formerly Square, has revealed a strategic move to bolster its Bitcoin holdings.
The company announced plans to automatically reinvest 10% of its monthly profits generated from Bitcoin products back into Bitcoin (BTC) in its Letter to Shareholders last Thursday.1
In the Letter Block, CEO Jack Dorsey emphasized the company’s belief in “an open protocol for money, not owned or controlled by any single entity,” and their view of Bitcoin as the prime candidate for this role.
The new policy signifies a significant allocation towards Bitcoin. Each month, a portion of the profits Block earns from Bitcoin-related products and services, such as facilitating Bitcoin purchases through Cash App, will be automatically converted and reinvested into additional Bitcoin.
This approach leverages a dollar-cost averaging (DCA) strategy, which involves investing a fixed amount of money into a particular asset at regular intervals, regardless of the asset’s price. This strategy aims to reduce the impact of market volatility on overall investment.
Block’s initiative comes amidst a period of increasing institutional adoption of Bitcoin. Major corporations are recognizing Bitcoin’s potential as a valuable asset class. Block’s decision to consistently reinvest profits highlights their long-term commitment to Bitcoin and their belief in its future appreciation.
- s29.q4cdn.com: https://s29.q4cdn.com/628966176/files/doc_financials/2024/q1/Shareholder-Letter_1Q24_Block.pdf[↩]
