The investment value of Bitcoin Block, the company founded by former Twitter CEO Jack Dorsey, has decreased by $36 million. This was revealed in the company’s Q2 2022 financial reports.
“In Q4 2020 and Q1 2021, we made $50 million and $170 million in Bitcoin investments. As intangible assets, the value suffers a loss. In the second quarter of 2022, we recognized a $36 million Bitcoin impairment loss. As of June 30, 2022, the fair value of our investment in bitcoin is $160 million.” mention Block in the report.
According to US corporate financial reporting rules, cryptocurrencies such as Bitcoin are intangible assets called intangible assetsso the final value must be stated, whether it makes a profit if the cryptocurrency is sold during a given quarter.
Last year, MicroStrategy received a reprimand from the US Securities and Exchange Commission (SEC) for failing to include the declining value of Bitcoin investments in its financial statements.
Loss of value of the company’s BTC investment Jack Dorsey it is also in line with Block’s lower gross profit for the business units trading the number one crypto asset.
Block noted that its Bitcoin business declined due to a drop in user demand for the Cash app and the impact of the fall in the price of Bitcoin (BTC).
Block said Cash App had revenue of $1.79 billion in the quarter, down 34 percent year-over-year. year after year. While the gross profit of Bitcoin is only 41 million US dollars.
“The year-over-year decline in Bitcoin revenue and gross profit is due to the decline in consumer demand and the decline in the price of Bitcoin. It’s the impact of global crypto market uncertainty during the quarter,” he said.
However, the company still posted year-on-year profit in the second quarter, which jumped 29 percent to $1.47 billion.
Bitcoin and Jack Dorsey Investment
Jack Dorsey is well known as a Bitcoin advocate, much longer than Elon Musk and Michael Saylor. He is often vocal on Twitter that bitcoin will continue to be interesting to own.
On July last yearin his quarterly earnings report, Dorsey said it was critical for Twitter and its shareholders to continue to watch and aggressively invest in the crypto market, including Bitcoin.
“I mean this [investasi Bitcoin-Red] is a big part of our future. “I think there’s a lot of innovation around the currency, especially as we think about decentralizing social media more and providing more economic incentives,” Dorsey said at the time. [ps]