Having stepped down as CEO of Twitter, bitcoin booster Jack Dorsey will likely be spending a lot more time at Square, the payments company he founded.
Given Square’s early and aggressive support of bitcoin — Cash App started allowing customers to buy and sell the first and largest cryptocurrency in January of 2018, just as the first big crypto winter hit — it seems likely that Dorsey’s already strong influence on the cryptocurrency will expand dramatically.
Dorsey and Tesla CEO Elon Musk are the two biggest corporate names in crypto, and particularly bitcoin. While his tweets don’t tend to move crypto markets to the extent that Musk’s do, Dorsey is notable in that he focuses on using bitcoin as a currency rather than just an investment.
Dorsey has repeatedly said he believes “bitcoin will be the native currency of the internet” — and on Wall Street, he is one of its most respected corporate boosters. He has incorporated bitcoin into Twitter, starting with its recent addition to the social media platform’s tip jar feature.
Bitcoin is also an important part of Square’s business, generating $1.82 billion of its $3.84 billion in net revenue in the third quarter — making crypto responsible for almost half of Square’s total sales. That said, like the Nasdaq-listed cryptocurrency exchange Coinbase, Square’s $42 million profit on bitcoin trading was down from Q2, which both attributed to stable prices generating fewer trades. However, it was up 29% year over year.
Earlier this month, Square announced plans to create a decentralized bitcoin exchange, tbDEX, saying the company believes that cryptocurrency “unlocks the potential for a future where commerce can happen without the permission, participation or benefit of financial intermediaries.”
In Jul,y Dorsey said he thinks bitcoin can help “create world peace” during a discussion with Musk moderated by ARK Invest CEO Cathie Wood.
“If I were not at Square or Twitter, I’d be working on bitcoin,” Dorsey said at a bitcoin conference in Miami this year. “If it needed more help than Square and Twitter, I would leave them for bitcoin. But I think both companies have a role to play.”
Square also purchased bitcoin for its own corporate treasury, adding $50 million in October 2020 and another $170 million in February — investments that have seen an enormous profit. And it is even considering getting into the bitcoin mining business.
Related news: Square Considering Bitcoin Mining System, Dorsey Says
Dorsey flexed some of his crypto influence back in October 2020, tweeting out criticism of Coinbase CEO Brian Armstrong’s no-political-advocacy mandate for the company in the wake of the Black Lives Matter movement. That turned the story into a wider debate about corporate responsibility in the cryptocurrency industry. Armstrong’s move eventually led to the departure of some 60 employees.
Blue Hoo Hoo
However, Twitter is a far bigger bully pulpit than Square, and Dorsey’s departure leaves a very big question mark on the social media giant’s involvement with cryptocurrency. Earlier this month, the company announced its new Twitter Crypto division. Its leader reported directly to then-CTO Parag Agrawal, who was appointed CEO of the company on Monday (Nov. 29).
The new division’s goal, according to Twitter Cryoto’s leader, blockchain expert Tess Rinearson, is to “explore how we can support the growing interest among creators to use decentralized apps to manage virtual goods and currencies, and to support their work and communities.” From there, she added that the division aims to explore “how ideas from crypto communities can help us push the boundaries of what’s possible with identity, community, ownership and more.”
Then there’s Bluesky, a Twitter-funded project that seeks to build a decentralized, open-source platform for social media. It was essentially a Dorsey passion project, meaning it could now fall by the wayside.
After all, Dorsey’s departure began with the early 2020 campaign by investment firms Silver Lake and Elliott Management to oust him as Twitter’s CEO, saying that splitting his attention between the two companies was hurting Twitter’s share price. The activist investment firms were appeased with board seats at the time.