First Mover: Bitcoin Hits $11K as Square Exposes $2.3T Corporate Money Pot

First Mover: Bitcoin Hits $11K as Square Exposes $2.3T Corporate Money Pot
S&P 500 companies have a combined $2.3 trillion in cash and short-term investments, a new money pot for bitcoin marketers.
(Oskay/Creative Commons, modified by CoinDesk)

Payments company Square’s announcement that it would put some $50 million, or , into has touched off speculation that more corporations might do the same. 

Jack Dorsey, the Twitter CEO who also helms Square, is a longtime bitcoin bull, so it wasn’t a huge surprise his company would put some of its corporate liquidity into the cryptocurrency. He’s following the path of MicroStrategy CEO Michael Saylor, who has invested . 

None other than Changpeng “CZ” Zhao, CEO of Binance, the world’s largest cryptocurrency exchange,  a question: “Who’s going to be the 3rd public company to hold #bitcoin in treasury?” Guesses included Twitter, Tesla, Apple, Warren Buffett’s Berkshire Hathaway, even the burger chain Wendy’s.

“It’s a bit surreal to see gigantic corporate entities now going knee-deep in bitcoin,” Mati Greenspan, founder of the foreign-exchange and cryptocurrency analysis firm Quantum Economics, wrote to subscribers on Thursday. 

One clever, enterprising soul even ginned up a spreadsheet to keep track of the corporate purchases and published it as a new website, : 

Companies in the Standard & Poor’s 500 Index of large U.S. stocks have a combined $2.3 trillion in cash and short-term investments. So a 1% across-the-board allocation to bitcoin would amount to $23 billion of purchases. That’s just over 10% of bitcoin’s total market capitalization, currently about . 

A big bullish investment thesis for bitcoin is that large institutional investors are on the verge of diving into cryptocurrencies as an asset class, led by money managers like Fidelity Investments that have embraced the new technology and digital-asset markets. 

Now it seems like corporate purchases might add to that buying pressure.  

Dorsey tweeted out a “” to his  explaining just how Square had come to buy its bitcoin — noting that the transparency was intended “so others can do the same.” 

“To maintain transaction privacy and price slippage on execution, treasury purchased the bitcoin over-the-counter with a bitcoin liquidity provider that we currently use as part of Cash App’s bitcoin trading product,” according to the whitepaper. “We negotiated a spread on top of a public bitcoin index and executed trades using a time-weighted average price (TWAP) over a predetermined 24-hour period with low expected price volatility and high market liquidity, in order to reduce risks associated with cost and pricing.”

Got that, corporate treasurers?  

Bitcoin has jumped over 3% in the past 24 hours to set a three-week high above $11,000.

– Omkar Godbole

Tether (), Solana (SOL): Tether launches on Solana, the “web-scale” blockchain, designed to compete with Ethereum and hopes to  while lowering costs. 

Bitcoin (BTC): Billionaire investor Chamath Palihapitiya sees bitcoin as .

Bitcoin Tops $11K for First Time in Almost 3 Weeks

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