Jack Dorsey-led payments firm Block on Thursday announced plans to ramp up investments in its Bitcoin mining initiative and self-custody Bitcoin wallet. The company said it would reallocate resources from its canceled “Web5” project, TBD, and cut investments in the music-streaming service, Tidal, to support this move.
“We are scaling back our investment in TIDAL and winding down TBD. This gives us room to invest in our bitcoin mining initiative, which has strong product market fit and a healthy pipeline of demand, and Bitkey, our self-custody wallet for bitcoin,” the company said in its shareholder letter for the quarter.
The development follows Donald Trump’s victory in the US presidential election, which has sparked optimism in the crypto community. Trump has supported plans to position the US as a leading hub for cryptocurrencies and promised to boost domestic Bitcoin mining.
He has openly criticized the Biden administration’s regulatory approach, calling it a “war on crypto.” Trump indicated that his administration would craft regulations with input from industry supporters rather than detractors.
Block’s Q3 Revenue Falls Short of Wall Street Projections
Separately, Block reported its third-quarter revenue, which missed Wall Street’s expectations, pointing to reduced consumer spending. Although the company exceeded profit forecasts due to strict cost controls, its stock initially dropped over 10% after hours. However, it later rebounded, with losses narrowing to under 4%.
Block’s net revenue for the quarter was $5.98b, below the $6.24b predicted by analysts, according to LSEG data.
Block’s Bitcoin Mining Push
Fortune reported that Block laid off many employees from Tidal last week and cut staff at its developer platform, TBD, this week. TBD had been working on Web5, a platform meant to support truly decentralized applications and protocols.
Block has expanded its investments in the Bitcoin mining sector, going beyond just running a mining operation. It is working on projects to enhance Bitcoin mining infrastructure, aiming to make it more accessible for individuals and small businesses.
Earlier this year, Block sold its first batch of 3-nanometer mining ASICs to Core Scientific. It also announced that it would reinvest 10% of its Bitcoin product profits each month to acquire more cryptocurrency.
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