Block CFO Says Cash App Owner’s Bitcoin Bet Is Long-Term Play

Paige Smith, Bloomberg News

Leaflets featuring the Bitcoin logo at a One Satoshi over-the-counter (OTC) cryptocurrency store in Hong Kong, China, on Monday, Feb. 26, 2024. Hong Kong pivoted toward fostering a digital-asset hub in late 2022, part of an effort to appear cutting-edge amid doubts about the city's future given Beijing's growing control over the former British colony. Photographer: Lam Yik/Bloomberg , Bloomberg

(Bloomberg) -- Block Inc.’s investment in Bitcoin allows the firm to learn more about what could be a “potentially transformative” technology, according to one of its top executives.

Chief Financial Officer and Chief Operating Officer Amrita Ahuja said the firm’s bet on Bitcoin is a long-term play. Block said earlier this year that it will invest 10% of gross profit from Bitcoin products each month into buying the cryptocurrency.

“We have a stake in the future, where money can move at the speed of the internet,” Ahuja said in an interview on Bloomberg Television Thursday. “We think that Bitcoin is the likeliest contender to enable that vision, because it is resilient, it’s been battle-tested, it’s secure.”

Ahuja said the most under-served consumers are often those who pay the highest fees to access and move money, a reality that Bitcoin could change.

Jack Dorsey, founder of Block, made the case in the most recent letter to shareholders that Bitcoin has the potential to “level the playing field” for firms like his and global consumers, noting that less than 3% of the company’s resources are allocated to Bitcoin-linked projects. Block is the parent company of businesses including Square and Cash App, as well as more nascent ventures TBD and Spiral. The firm’s first-quarter Ebitda, or adjusted earnings before interest, taxes, depreciation and amortization, nearly doubled from a year earlier.

Block takes the somewhat unusual approach of holding Bitcoin on its own balance sheet, which Ahuja said helps teach the company about the technology.

“It helps us understand what it means to custody Bitcoin, what it means for our treasury teams out in the market buying Bitcoin,” she said.

--With assistance from Ed Ludlow and Caroline Hyde.