Fortune Article

In the early days of crypto there were just a handful of companies, including some venerable names like Coinbase, Kraken, and Grayscale, which are still around. Today, there are hundreds of firms that offer crypto, including those like BlackRock and PayPal that operate primarily in the world of conventional finance. For me, the most intriguing of all of them at this moment is Block. The firm is best known to consumers for its Square devices at stores and peer-to-peer Cash App, but has also quietly built an impressive Bitcoin empire that is raking in money and also features a growing number of innovative products.

I was reminded of this when I spoke with Block’s director of product, Michael Rihani, whose previous stints include managing Tesla’s Bitcoin operations and helping build Apple Pay. He shared details about Block’s latest crypto offering, called Bitcoin Conversions, which lets thousands of Square merchants convert 1% to 10% of their daily sales into Bitcoin and move it into their personal Cash App account. The process is a bit like when you choose to allocate a portion of your paycheck into a dedicated savings account.

I was initially skeptical on the grounds that I didn’t think there could be very many owners of coffee shops or flower stores or whatever who want to direct part of their daily sales into Bitcoin. But Rihani says Block has already been working with over 100 merchants to develop the alpha version of the product, and that the company has received plenty of interest. While Bitcoin Conversions is hardly going to open a floodgate on the level of the recent ETF offerings, it does open yet another conduit between Bitcoin and mainstream commerce—and, given how merchants in every corner of the country rely on Square, it could become significant over time. And for Block, which booked $66 million in Cash App–related Bitcoin profits last quarter alone, it will mean yet more crypto revenue.

Meanwhile, the company’s CEO, Jack Dorsey, this week announced a major new crypto initiative in the form of a Bitcoin mining rig. This is a big deal in that Block’s rig, an outgrowth of the firm’s existing chip initiatives, seeks to diversify mining operations—which now rely heavily on devices produced by a small oligopoly of Chinese manufacturers—and to lessen excessive heat and noise associated with the process. The mining initiative also comes shortly after Block began shipping these cool rock-like wallets that let people custody their own Bitcoin.

All of this underscores how Dorsey is not just one of the Fortune 500’s most eccentric CEOs but also one of the most visionary. While his Bitcoin-only philosophy is off-putting to many in the broader crypto world, his relentless quest to expand the reach of Bitcoin while also running a highly profitable public company makes Dorsey and Block a unique force in the industry.

Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts

DECENTRALIZED NEWS

The Justice Department will ask a federal judge to sentence Binance founder Changpeng Zhao to three years in prison at a hearing next week in Seattle. (Fortune)

The crypto eyeball-scanning project Worldcoin has been in talks with major tech players like OpenAI and PayPal to expand its reach even as it faces regulatory blowback. (Bloomberg)

A new survey of long-dormant Bitcoin wallets from a decade ago shows that thousands keep “waking up” and, in some cases, delivering large fortunes to their owners. (Fortune)

Traders are no longer paying premiums to open long positions of Bitcoin futures—another indicator, along with a decline in ETF inflows, that the bull market has cooled. (Bloomberg)

The Justice Department arrested the founders and seized the servers of Samourai Wallet, a crypto mixer that had used social media to invite Russian oligarchs to use its service. (WSJ)