Payments giant Square said Tuesday it had purchased an additional $170 million of bitcoin (BTC), adding to the stash it purchased in October.
According to the payment processor’s press release, the company added 3,318 BTC to its treasury for $170 million. Doing the math, that results in a per bitcoin purchase price of $51,235.70.
Unfortunately for Square, after setting a record high above $58,000 over this past weekend, bitcoin hit a recent low of $44,964.49 before rebounding to about $49847 at press time.
When Square’s announcement was released, just after 4 p.m. New York time, the price of bitcoin was below $48,000, which means those 3,318 BTC were then worth less than $160 million.
In disclosing it lost more than $10 million in its latest investment in BTC, the company may inadvertently draw attention to an argument that JPMorgan analysts have made as to why they think many companies won’t be following in the footsteps of Square and others (Tesla, MicroStrategy) who’ve added BTC to their treasuries, namely the cryptocurrency’s volatility.
The company made the announcement just before the release of its fourth-quarter earnings call that it had added to the 4,709 BTC it purchased in October 2020, which were worth $50 million at the time. Currently, that investment is worth $224 million and the company’s total value of BTC on Square’s balance sheet is $394 million.