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Square Bought Additional Bitcoin at the Top, Announced at the Dip!

Highlights

    Square Inc announced the purchase of additional bitcoin worth nearly $170 million in early trading hours.

    The stock price of the institutions also sank to a large extent with the massive bitcoin drop which included Square, Microstrategy, Tesla, etc

    As the rounds of bitcoin purchase rolled out, Bitcoin trades again above $50K and the Share value of Square also surged

Square’s Panic Announcement!

Square Inc, a financial services and payment gateway platform,  just announced another set of Bitcoin worth nearly $170 million. With the announcement, BTC price flipped the bearish momentum and trades above $50K.

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As per the official announcement of the fourth quarter, it purchased 3,318 BTC for approximately $170 million and hence nearly $51,235.68 per Bitcoin. Bitcoin price smashed $50K levels in the current month and hence including the recent purchase in the fourth quarter report appears a little bizarre.

However, the spotlight remains on the stock price of Square, which witnessed a massive sell-out in the previous working day as the Bitcoin price slashed. The stock price also dropped significantly draining out nearly 15% share value. 

The share value of Square Inc recorded the most substantial red candles ever in history and a positive boost was the need of the hour to stop the candles paint red.

Therefore, the company may have purchased Bitcoin at the peak above $50K and announced it as the Bitcoin price feared hitting bottom levels around $40K.

Nevertheless, both Bitcoin price and Square Inc share value assisted each other to rise again to recover the losses.

Did Bitcoin Price dump impact other institutions?

Bitcoin price experienced a massive dump, the two consecutive days resulting in the dip of the value of the holdings held by the Institutions. Sprinkling salt on burn, the share value of these institutions also plunged notably.

The share value of Microstrategy that hit the highest ever levels above $1300 after the announcement of the recent bitcoin purchase, plunged below $1000 initially. With the Bitcoin dump, the share value is currently less than $700, yet waiting for a recovery.

Coming to Tesla, which shook the entire market with its bitcoin investment, also witnessed a massive plunge draining out nearly 20% of the price. At the press time, the price has increased by nearly 15%, close to surpassing $700 levels.

Despite the massive Bitcoin dump, most of the institutions were still joyful as they had already doubled their investment. According to the data in the Bitcoin Treasuries, the combined profit of all the institutions is more than $20 billion. 

On the other hand, Square possibly bought bitcoin just before the massive plunge in the BTC price. Therefore compelling them to include the recent purchase in the fourth quarter report which was as of December 2020!

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Qadir AK

Qadir Ak is the founder of Coinpedia. He has over a decade of experience writing about technology and has been covering the blockchain and cryptocurrency space since 2010. He has also interviewed a few prominent experts within the cryptocurrency space.

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