Bitcoin Related Impairment?

Square’s bitcoin-related investments had a $45 million drag on operating income in its second quarter, the company said late Sunday, more than double its Q1 impairment. Square, a digital payments company, revealed in February it bought $170 million worth of bitcoin, expanding on its October 2020 purchase. That represented about 5% of the company’s total assets as of the end of 2020.

Bitcoin’s price peaked above $63,000 in April and then dropped below $30,000 in early July. Bitcoin was trading at just above $39,000 as of Monday morning.

Square posts $45 million in bitcoin-related impairments in second quarter

Square said it still saw “significant growth in bitcoin revenue year over year this past quarter. Bitcoin revenue came in at $2.72 billion, up approximately three times year over year. At the same time, bitcoin gross profit was $55 million, or approximately 2% of bitcoin revenue.”

Meantime, gross profit increased 91% from a year ago, which marked a record quarterly growth rate. Net revenue excluding bitcoin came in at $1.96 billion for the quarter, an 87% rise year over year.