Holding Bitcoin Paid Block 4x More Than Selling It to Cash App Users

Block, Jack Dorsey’s payments company, recorded a $229.7 million third-quarter gain from revaluing its Bitcoin investment, exceeding by more than four times the $52 million gross profit from its Bitcoin business. The company held 9,237 BTC worth $771.9 million on September 30 and revalues those holdings each quarter, with changes flowing through standard accounting earnings. This gain equaled about 38% of $612.5 million pre-tax income and helped raise net income to $566 million from $462 million a year earlier, after three consecutive quarters of remeasurement losses. Meanwhile, Bitcoin business gross profit fell 50% from $104 million as Block cut fees on some Cash App Bitcoin transactions, and its gross margin slipped to about 2.9% from 5.1%.