Biggest Bitcoin Players Include Tesla, Square, Mastercard

Despite its criticisms, bitcoin has seen a meteoric rise in 2021 as companies embrace the adoption of digital currencies, prompting them to make their own investments. The world’s largest cryptocurrency hit over $ 50,000 on Wednesday.

Below is a FOX Business roundup on bitcoin and the biggest players in the cryptocurrency industry:

ELON MUSK EXPLAINS TESLA’S $ 1.5B BITCOIN PURCHASE

Square

Square announced on Tuesday that it will invest an additional $ 170 million in Bitcoin as the payments company “doubles” its commitment.

“By owning Bitcoin, our incentives are aligned with the skin of the game,” Square CEO Jack Dorsey said in a conference call with analysts after the results. The company bought 3,318 bitcoin in the fourth quarter, or more than $ 51,200 per bitcoin, according to Reuters calculations.

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This decision was based on the 4,709 bitcoins purchased in October 2020 at an aggregate price of $ 50 million.

Square has been involved in the currency for years and its Cash app, a payment service, has been allowing users to exchange it since 2018. The app had three million active bitcoin customers in 2020, with one million new users purchasing the coin. currency for the first time in January, the company said.

Twitter

At Dorsey’s “other company” – Twitter – the social media giant recently considered paying employees in cryptocurrency if they prefer this payment method.

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“We did a lot of thinking initially to look at how we might pay employees if they ask to be paid in bitcoin, how we might pay a vendor if they ask. [paid] in bitcoin and whether we should have bitcoin on our balance sheet if that happens, ”said Ned Segal, chief financial officer of Twitter. CNBC’s “Squawk Box”.

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Electric automaker Tesla announced in an SEC filing earlier this month that it had invested $ 1.5 billion in bitcoin to “further diversify and maximize” the return on its money. Additionally, the company said it plans to start accepting bitcoin as a payment method for its cars in the “near future.”

“When fiat currency has negative real interest, only a fool wouldn’t look elsewhere,” CEO Elon Musk explained in a tweet. “Bitcoin is almost as good as fiat money. The key word is ‘almost’.”

Musk acknowledged that he was a “bitcoin supporter” when asked about his thoughts on cryptocurrencies during a live interview on the popular Club House audio chat app on February 1.

“Many friends of mine have tried to convince me to get involved in bitcoin for a long time,” he added.

MicroStrategy

Musk’s decision to add bitcoin to Tesla’s balance sheet follows an exchange he had with MicroStrategy CEO Michael Saylor. In December, its mobile software / business intelligence company said it had amassed more than $ 1.3 billion in cryptocurrency.

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Last week, MicroStrategy announced plans to use the proceeds from a $ 600 million convertible bond sale to increase its bitcoin holdings. The notes are expected to mature on February 15, 2027.

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Galaxy Fund

Michael Novogratz’s Galaxy Holdings has also become a major player in bitcoin. The asset management company, which focuses on digital currencies, announced during its third quarter earnings report that it held $ 176.4 million in bitcoin as of September 30, of which around 41, $ 2 million held by minority interests.

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Former hedge fund Bigwig recently told Bloomberg that it predicts bitcoin will more than double by the end of this year to $ 100,000.

I can

Mogo, a Canadian financial technology company, is also jumping into the action. The company announced in December that it intends to make an initial investment of up to $ 1.5 million in bitcoin and that it would consider additional investments in 2021 as it monetizes its investment portfolio of $ 17 million.

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The initial purchase represents approximately 1.5% of Mogo’s total assets at the end of the third quarter of 2020.

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Meanwhile, other companies, without making direct investments in bitcoin, have adopted cryptocurrencies in their services:

BNY Mellon

BNY Mellon, the oldest bank in the United States, recently announced that it will be the first global bank to create a “digital asset” service later in 2021.

“BNY Mellon is proud to be the first global bank to announce its intention to provide an integrated service for digital assets,” said Roman Regelman, CEO of Asset Management and Head of Digital at BNY Mellon, in a statement. “Growing customer demand for digital assets, the maturity of advanced solutions and improved regulatory clarity provide us with a tremendous opportunity to extend our current service offerings to this emerging area. Pending further assessments and approvals, we plan to begin offering these innovative and industrial services. shaping capabilities later this year. “

MasterCard

Best known for its credit cards, the household name recently announced plans to start supporting certain cryptocurrencies later this year.

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“We are preparing for the future of crypto and payments right now, announcing that this year Mastercard will begin supporting certain cryptocurrencies directly on our network,” the company said in a blog post. “This is a big change that will take a lot of work. We will be very attentive to the assets we support based on our Principles for Digital Currencies, which focus on consumer protection and compliance.”

Black rock

In January, BlackRock revealed in an SEC filing that it would add Bitcoin as a qualifying investment to two funds, BlackRock Strategic Income Opportunities and BlackRock Global Allocation Fund Inc.

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The world’s largest asset management company said the two aforementioned funds would only invest in cash-settled Bitcoin futures contracts traded on commodity exchanges registered with the Commodity Futures Trading Commission.

Silvergate

In December, the digital currency bank Silvergate announced in its fourth quarter earnings report that its digital currency deposits had grown to $ 5 billion as of December 31, 2020, from $ 2.1 billion as of December 31, 2020. September 30.

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The company’s in-house Silvergate Exchange Network (“SEN”) processed 90,763 transactions in Q4 2020, an increase of 33%, compared to 68,361 transactions in Q3 2020, and an increase of 530% from 14,400 transactions in the fourth quarter of 2019.

The company recently launched a new loan offering called SEN Leverage, which allows its customers to obtain US dollar loans backed by Bitcoin. Silvergate CEO Alan Lane said the company expects increased demand for the supply over the next year. “

Pay Pal

In October, PayPal announced that it would roll out a service this year that allows customers to buy, sell, and hold cryptocurrencies directly from their PayPal accounts.

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“The shift to digital forms of currency is inevitable, bringing with it clear benefits in terms of financial inclusion and access, efficiency, speed and resilience of the payment system; and the ability of governments to quickly disburse funds to citizens, ”said Dan, CEO of PayPal Schulman said in a press release. “Our global reach, digital payments expertise, two-way network, and rigorous security and compliance controls provide us with the opportunity and responsibility to help facilitate the understanding, exchange and interoperability of these new instruments of exchange. “

In addition to Bitcoin, PayPal’s service supports Ethereum, Bitcoin Cash, and Litecoin directly in PayPal’s digital wallet. The service has already been rolled out in the US and US territories and the company plans to expand the service internationally in the first half of the year.