Breaking: Square buys $50 million in Bitcoin, believes that this is the currency of the future


  • Square buys $50M in Bitcoin, believes that this is the currency of the future

Square is a giant American financial services, merchant services aggregator, and mobile payment company with more than $4.7 billion in revenue just in 2019. It was founded by Jack Dorsey, the current CEO and co-founder of Twitter. Dorsey has been a big fan of Bitcoin for quite some time, even calling it the 'best Internet currency' once. 

According to the official announcement, the company has invested $50 million, purchasing approximately 4,709 Bitcoins. 

We believe that bitcoin has the potential to be a more ubiquitous currency in the future, said Square’s Chief Financial Officer, Amrita Ahuja. As it grows in adoption, we intend to learn and participate in a disciplined way. For a company that is building products based on a more inclusive future, this investment is a step on that journey

This is not the first crypto investment from Square. Previously, the company launched a Bitcoin trading App in 2018 and formed Square Crypto in 2019, a team focused on contributing to the Bitcoin open-source development. 

Bitcoin jumps 2.5% following the announcement

Bitcoin had a massively positive reaction to the news from Square and it's already trading at $10,886 from a low of $10,535. 

BTC/USD daily chart

btc price

This recent move has the potential to change the dynamic of Bitcoin in the short and medium terms. On the daily chart, Bitcoin has established the 100-SMA as a strong support level and it's fighting to crack the 50-SMA and turn it into support, something that hasn't happened since July. A bullish breakout above $10,890 has the potential to push Bitcoin up to $12,000 to re-test this psychological level. 

BTC IOMAP Chart

btc price

The In/Out of the Money Around Price chart by IntoTheBlock shows very little resistance ahead compared to the support below. There is a massive support area between $10,563 and $10,871 where 1.5 million BTC was purchased. In comparison, from $10,891 to $11,547, only around 840,000 BTC was bought.

BTC/USD 4-hour chart

btc price

At $10,920, Bitcoin is trading right around a significant resistance level tested twice on September 28 and October 1. The MACD has turned bullish for the first time since October 4 and the 50-SMA and 100-SMA are now support levels.

A rejection from $10,900 could still pose a threat for the bulls in the short-term, with the potential to drop Bitcoin down to $10,800, the last resistance level. 

If bears see continuation after a rejection from the daily 50-SMA, Bitcoin could still slip towards $10,600 again.

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