Square Will Not Be Buying New Bitcoins as Carbon Concerns Loom
- Square’s CFO says bitcoin’s carbon footprint needs to be addressed
- The fintech company calls for innovation in the way cryptocurrencies are mined
Square Voices Environmental Concerns
The digital payments company, Square, had a big announcement last week. It will not be purchasing more Bitcoin at least until cleaner energy sources are found. Square’s CFO, Amrita Ahuja, said during an interview that the fintech company had “no plans” to buy more bitcoin as the current crypto space “is an area that needs innovation” in clean energy.
“We don’t have any plans at this point to make further purchases. There are no plans at this point to re-evaluate where we are from a treasury standpoint,” Ms. Ahuja said. Square currently holds 8,027 bitcoins, worth a little less than $400mn at the present price of around $45,000.
“Our position has always been that this is an area that needs innovation in terms of renewables and clean energy, and we want to be a part of that,” she commented. “There’s a broader supply chain question around how renewables and clean energy become a greater part of the blockchain in general, and a greater part of the overall mining and transaction network. It’s the overall fixed footprint of the network that we need to address,” Square CFO concluded.
Square’s Background & Quarter 1 Earnings
Square, led by Twitter CEO Jack Dorsey, was one of the first companies from traditional finance to jump into the crypto industry and is now holding 5% of its treasury in Bitcoin. The company invested $50mn from its cash into Bitcoin in October last year, and added $170mn more this February. The bitcoin investment, as per the first quarter earnings report, accounted for a $20mn asset impairment loss in the Bitcoin holdings.
The overall concern for the carbon footprint used in the Bitcoin network started making waves earlier this month. When Tesla’s Chief Executive Elon Musk said the electric car company will no longer be accepting Bitcoin for car purchases. Mr. Musk’s dismissal of Bitcoin due to its high-energy consumption knocked off bitcoin’s price to levels below $50,000.