In its Q3 2024 update, Block announced plans to prioritize Bitcoin-related projects, increasing investment in mining and self-custody.
By Anisha Pandey
Edited by Julia Sakovich
Updated
3 mins read
Block Inc has announced an intensified commitment to Bitcoin mining and self-custody wallet initiatives as it navigates a shifting landscape in the crypto industry.
In its recent Q3 2024 shareholder letter, Block outlined its plans to allocate more resources toward its Bitcoin mining project and Bitkey, the company’s Bitcoin self-custody wallet.
Block’s Bitcoin mining strategy comes amid the recent political support for the industry. Donald Trump, in his latest campaign, stated that the United States should be a global leader in Bitcoin mining. This sentiment was echoed in Block’s own announcement, which spoke of “healthy demand” for its Bitcoin mining solutions.
Earlier in 2024, Block announced that it had completed the design of a cutting-edge three-nanometer chip specifically developed for Bitcoin mining, with plans to build a full-scale Bitcoin mining system. In July, Block signed a partnership with mining firm Core Scientific to supply these advanced mining chips, a step that could enhance mining efficiency while supporting broader decentralization efforts in Bitcoin mining.
Amid increasing mining efforts, Block has decided to scale back its investments in music streaming service Tidal and its decentralized web platform, Web5. This shift, already reflected in recent staff layoffs, marks a move to consolidate resources in core crypto offerings. The reported layoffs come less than a year after a 10% reduction in staff in December 2023, underscoring Block’s prioritization of the projects that align most closely with its crypto focus.
It is worth noting that Block was originally established in 2009 as a mobile payments company called Square. However, after rebranding in 2021, it started prioritizing the DeFi and cryptocurrency sectors.
Despite Block’s forward momentum in mining, its Q3 earnings report was a mixed bag. As per the announcement, the company’s Bitcoin BTC $95 834 24h volatility: 0.2% Market cap: $1.89 T Vol. 24h: $92.87 B revenue, primarily generated from fees on the Cash App platform, remained stagnant at $2.43 billion — unchanged from the same quarter in 2023. Total revenues rose modestly to $5.98 billion, marking a 6.4% year-over-year increase but still missing Wall Street expectations of $6.17 billion.
Following the report, Block’s shares experienced a steep 12.3% drop in after-hours trading, with prices hitting $66 before. However, the price rebounded to $75.27 at the market close. Notably, despite this setback, Block’s share remains up 4.2% year-to-date.
Block’s current pivot toward mining and away from Tidal and Web5 aligns with a period of intensified regulatory scrutiny. In June, Block came under investigation by US federal authorities regarding its compliance practices, specifically for potential violations related to transactions with sanctioned countries. The company’s operations, including its Cash App crypto unit, have been examined for alleged connections to transactions linked to nations under US sanctions, including Russia, Iran, Cuba, and Venezuela.
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With a background in finance and a passion for innovation, Anisha has been covering the ever-evolving world of crypto for over four years. Her deep understanding of the crypto market have made her a trusted source for analysis and news. Whether it's dissecting the latest trends or decoding whitepapers, Anisha is dedicated to bringing clarity to the world of digital assets.
