Former Twitter CEO Jack Dorsey’s digital payments firm Block Inc. saw its year-on-year (YoY) profits soar 29% to $1.47 billion in Q2.
Yet, its Bitcoin (BTC) business sank on decreased customer demand and a fall in Bitcoin prices.
Block primarily generates Bitcoin revenue by providing BTC trading services via its digital payments application Cash App.
Block Inc. noted the business generated $1.79 billion of Bitcoin revenue in the quarter, down 34% YoY, while Bitcoin gross profit was only $41 million, which suggests it may be a high-cost venture to provide Bitcoin services to its customers.
Block Inc. emphasized that the BTC profit slump doesn’t reflect the broader performance of the business. It also noted that BTC profits will likely fluctuate over time as a result of “changes in customer demand or the market price of Bitcoin.”
The company also noted that it recognized a $36 million impairment loss on its BTC holdings.