Square CEO Jack Dorsey, who is also the chairman and creator of Twitter, said on Friday that his digital payments company is considering creating a hardware wallet for Bitcoin. It will allow users to store their cryptocurrency without being controlled by Square or another company.
“If we do it, we would build it entirely in the open, from software to hardware design, and in collaboration with the community”, Dorsey wrote on his Twitter account.
As Bitcoin and other cryptocurrencies gain traction, many companies have begun to develop products that meet the growing need to protect these digital assets from theft. A hardware wallet is essentially a flash drive where you can safely store your crypto assets offline or online. And you can choose when to spend them later. Securing your cryptocurrency properly allows you to control your money in ways that weren’t possible before.
Jack Dorsey noted that using a hardware wallet would give customers more control over the cryptocurrency. Since only the owner himself would have access to the device. Currently, some companies that allow customers to buy Bitcoin, such as PayPal, do not provide the ability to store coins outside of their ecosystem.
After Dorsey’s comments on Twitter, Square Inc (NYSE: SQ) rose 3.3% but ended up closing the day 1% higher than the day before.
Bitcoin transactions are the main source of income for Square
Bitcoin trades and transactions are now the main source of income for Square. The company gives consumers the ability to make purchases of cryptocurrency through CashApp and even store it digitally. According to 2020 data, the company’s Bitcoin sales grew from $ 516 million in 2019 to $ 4.75 million at the end of 2020. Dorsey’s proposals aim to remove the aspect of control by third parties, including Square.
Cryptocurrency is seriously affecting Square’s business. The company’s revenue from Bitcoin transactions in the first quarter of 2021 grew by 1,047% to $ 3.51 billion year on year. Accordingly, the bitcoin price strongly affects the value of Square’s shares.
The company first announced the purchase of Bitcoin in October 2020. Then it purchased 4709 coins for $ 50 million. In February 2021, the company again invested $ 170 million in cryptocurrency, having bought 3318 coins.
In May, Square’s CFO Amrita Ahuja said the company had no plans to change its investment strategy, of which Bitcoin would remain a part.
When does the real development of a hardware wallet start?
Dorsey explained that the integration of the wallet with the Cash App is “obvious”, but “only part of the solution”.
As for the exact time when real development could begin, Dorsey didn’t specify.
The Square wallet is likely to be without a display, making it more convenient and affordable. Whether the development team will be able to create a strong competitor to the Ledger and Trezor hardware wallets is hard to say yet. Square executives will continue talking about the hardware wallet. And will also open a dedicated Twitter and GitHub account if the wallet plan continues.