Square won't be affected by Bitcoin's fluctuations

Everybody seems to be talking about cryptocurrency. It is so much in talks that even I tried investing in a few cryptocurrencies over the last week, following the hype of long-term investments. However, while analyzing trends and reading more about cryptocurrencies, I came across Square that is leading the race of securing cryptocurrency transactions. I found that Square can be the best way to invest in cryptocurrency.

Square crypto (NYSE: SQ) is a financial services provider founded by Jack Dorsey, CEO, Twitter. It enables merchants to process card payments through hardware as well as point-of-sale software. What's more? It also provides analytics related to payments.

It is majorly known as the Bitcoin exchange market and custodial wallet that derives profits from a variety of transactions. Its flagship product Cash App – a mobile payment service that encourages peer-to-peer digital payments.

In June 2019, Square Cash App crypto introduced bitcoin deposits. Users can use this mobile service to buy and sell bitcoins as well as transfer cryptocurrency to other wallets. In the first quarter of 2019 itself, Square earned $65.5 million in revenue. In the last year, revenue from bitcoin was $1.8 billion, a staggering 10X increase over 2019's revenues.

Square's prosperity has been accelerated by Bitcoin. Besides the gigantic investment Square in 2020 by buying BTC worth $500 million, some portion of the Cash App's allure is for the simple way users can purchase and sell bitcoin.

With so many cryptocurrencies like Ether, Dogecoin, etc. reaching new highs constantly, Square crypto is set to keep harnessing the benefits. However, as we all predict, Bitcoin is inclined to go up a lot, yet those periods are normally trailed by episodes of huge pullbacks. Wondering what happens when the most recent Bitcoin bubble explodes and how it will affect Square and cryptocurrency?

If we look back a year, Square moved rapidly to address the developing requirements of its users as repercussions of COVID-19 were faced by businesses as well as people. Square Cash App was well-situated to assist users in adapting to the changing landscapes. Moreover, its resilience is supported by its ability to facilitate multiple use cases and an extensive customer base.

Further, according to Mizuho expert Dan Dolev, Bitcoin's pullbacks cannot touch Square's growth.

He points out that a sensational positive inflection in user engagement guarantees that SQ's Bitcoin revenue should grow whether Bitcoin value levels dip down or increase. He gauges that if Bitcoin comes to $100,000 by year-end, this could drive a 9x increment in Bitcoin gross profit. Notwithstanding, if Bitcoin dropped to $10,000, its GP, in any case, will twofold, supported by a growing user base and higher engagement.

For example, Bitcoin's average quarterly cost dropped from around $10,600 to $3,800 somewhere between the time period of 1Q18 and 1Q19. All things considered, during that same time period, Cash App's Bitcoin GP quadrupled from $0.2 million to $0.8 million as Bitcoin GP for each user multiplied to $0.5.

Once more, somewhere in the time range of 3Q19 and 1Q20, Bitcoin's average cost declined from around $10,400 to $8,300, however in general GP from Bitcoin expanded more than triple from $2.1 million to $6.7 million, while GP per user-developed from $0.4 to $1.2.

These numbers and a fantastic analysis clearly point out Square is powerful and the safest option to invest in cryptocurrency.

Simultaneously, Bitcoin has brought a huge number of users into Square's Cash App platform, which is vital to its two-sided financial platform. In March, Square said that 7 million Cash Cards were initiated through the Cash App and that it is driving record cash inflows and profits for the app.

On the user front, Square is attempting to make the Cash App into the core of our financial lives. It tends to be utilized for transfers, bitcoin, deposits, and stock investments. Regardless of whether Bitcoin disappears, Square is adding a huge number of users to its Cash App who could ultimately be banking or investment clients that can buy crypto on Cash App. What's more, regardless of whether Bitcoin recoils insignificance, it has been key in pulling in these users to the platform.

Nonetheless, what drives volume in crypto transactions in the future would probably be security, choice of crypto assets, and extra significant services that can be brought to bear. From this perspective, who's your winner after reading this article?