Jack Dorsey, co-founder of Twitter, spoke at the Bitcoin 2021 conference in Miami, Florida, USA on Friday, June 4, 2021.
Eva Marie Uzcategui | Bloomberg | Getty Images
In the crypto-crazy summer of 2021, when meme coins like Dogecoin and Shiba Inu were soaring alongside Bitcoin and Ethereum, Square founder Jack Dorsey said: announced He said his payments company is launching a new business unit with the goal of “making it easier to create non-custodial, permissionless, decentralized financial services.”
“Our main focus is #bitcoin'' Dorsey declared on Twitter. The name of the business division has not yet been decided.
In December of that year, Dorsey went one step further. Changed company name from Square Co., Ltd. to Block.he said, is a reference to a number of things, including blockchain, the technology behind Bitcoin. The Square Crypto business is now known as Spiral.
Three years later, Dorsey is backing out.
above blockOn Thursday's third-quarter earnings call, CFO Amrita Ahuja said Block had “recently made decisions regarding some of our new initiatives” and was “scaling back some of our undetermined initiatives.”
Block continues to own large amounts of assets. Bitcoin On the balance sheet, the current value of its holdings has ballooned to $630 million. The company then announced that it would invest in Bitcoin mining efforts and its Bitcoin wallet, Bitkey, while still allowing users to purchase Bitcoin through the Cash App.
It's a noticeable change in tone.
TBD was designed as a developer platform for Block. Block called it Web5 and said its mission is to create a more decentralized, secure, and private Internet. In a mid-2022 tweet, Dorsey said Web5 “will probably be the most important contribution to the Internet.”
Square's 5-year stock price chart
However, Wall Street's view of cryptocurrencies began to deteriorate dramatically. With inflation surging in 2022 and interest rates rising, shareholders sought faster returns on their investments. After peaking in 2021, Block stocks lost more than 80% of their value before bottoming out in October 2023.
Block said that would happen in late 2023. reduce head count Mr. Block has laid off most of his unspecified employees in recent weeks. And in his third-quarter letter to shareholders, Bullock announced his investment in Tidal, the music streaming service founded by Jay-Z, after spending about $300 million to acquire a majority stake in the business in 2021. He said it would be “downsized.” Part of TBD.
Dorsey was asked by an analyst on a call Thursday about the company's current Bitcoin strategy.
“Our focus in terms of our overall strategy around Bitcoin is to make Bitcoin more accessible, so more people can access, buy and sell Bitcoin,” Dorsey said. “Of course, we want to be able to send it peer-to-peer,” he said. .
Dorsey added that he would like to see “a native currency on the internet.” That would allow Block to move funds faster and offer Cash App and other products in more markets.
A Block spokesperson reiterated the company's public statements and pointed to Dorsey's comments on the earnings call.
What has become clear is that while trying to appease a more discerning Wall Street, there are limits to what Dorsey can do with cryptocurrencies. Block stock was down about 1% at market close on Friday after the company reported lower-than-expected sales and issued a weaker gross profit outlook than some analysts expected.
In a 1,400-word letter to shareholders, Dorsey focused entirely on the company's small business lending. A significant portion of this is Afterpay's “buy now, pay later” product, which Block acquired in 2021 for $29 billion.
Dorsey never mentioned cryptocurrencies or Bitcoin.
clock: Block and affirm slides about revenue
