Quarterly earnings reports are beginning to come in for the financial sector, including updates on the state of crypto adoption in the industry.
Despite some companies feeling the effects of the crypto winter, even those are performing better than analysts expected. For firms with other priorities that have still incorporated crypto in their operations, such as MicroStrategy, the asset class has contributed to their success.
Surpassing Predictions and Overcoming Short-Seller Doubts
Block, previously known as Square for its business platform, reported a slight increase in revenues and earnings per share despite doubts fueled in part by a report published by short-sellers at Hindenburg Research. The company is reportedly considering legal action against the research firm.
“We intend to work with the SEC and explore legal action against Hindenburg Research for the factually inaccurate and misleading report they shared about our Cash App business today. We will not be distracted by typical short-seller tactics.”
Although Block’s quarterly results turned out well, the company’s stock plummeted after the report was released. However, the company reported earnings per share of 40 cents, surpassing analysts’ predictions of 35 cents. At the time of writing, the company’s stocks were valued at just under $60, according to MarketWatch.
Bitcoin’s Contribution to Block’s Recovery
Jack Dorsey, co-founder of Twitter and current CEO of Block, has long been a Bitcoin advocate. This quarter, the cryptocurrency played a pivotal role in the company’s financial results, which could lead to even greater success in the future.
Block reported a 25% increase in Bitcoin sales on CashApp – one of its most highly anticipated products – compared to last year. This is a stark contrast to the prior quarterly report that indicated a 7% YoY decrease in Bitcoin sales.
Although earnings from BTC sales only accounted for $50 million of the company’s total gross profit of $1.71 billion, the results prove that Bitcoin adoption rates are still increasing among the public.
As institutional investors continue to acquire BTC using traditional financial products, it’s important to maintain easy public access to crypto products – as Block’s financials demonstrate, doing so can lead to profit.