Shares of Square are up more than 6% today after the American fintech company reported a staggering $5.06 billion in revenue in its Q1 2021 earnings report, far ahead of an expected tally of $3.36 billion.
By posting the huge revenue beat, Square grew 266% compared to its year-ago Q1. Because that’s the sort of growth that we generally expect to see from early-stage startups instead of maturing public companies, some exploration is in order. In short, bitcoin revenues from Square, and how they fit into its accounting, are responsible for much of its outsized growth.
And that’s something we need to talk about.
The Exchange explores startups, markets and money.
Square’s performance apart from its bitcoin-driven results were strong. But its bitcoin incomes underscore not only rising consumer sentiment concerning bitcoin, but also an interesting angle on the question of Coinbase and its long-term fee structure.
Mix in the huge growth in bitcoin investment activity that Robinhood has seen and we can easily understand that, at least in the American market, consumers are not beholden to traditional cryptocurrency arguments regarding coin ownership. And the pace at which non-Coinbase entities are accreting trading volume could point to more competition at the now-public crypto exchange than some fans, backers and believers anticipated.