Block has an accounting quirk where they report Bitcoin that users purchase through CashApp under "revenue".
Revenue feels like the wrong place for this number to show up, but the result is that it inflates their revenue number
Revenue feels like the wrong place for this number to show up, but the result is that it inflates their revenue number
I am not sure the justification of it. Ages ago the debate was, if bitcoin was asset, currency or commodity? But how does buying something through an exchange results in the asset's entire price to be recognized as revenue for the company? They are doing it only for Bitcoin, not for any other things. I have no clue because it doesn't make sense.
From the 10-k [0]
...customers access to hundreds of listed stocks and ETFs, as well as the ability to buy and sell bitcoin. Stocks, ETFs, or bitcoin can be purchased...e. For bitcoin buying and selling, we recognize revenue when customers purchase bitcoin and it is transferred to the customer's account.
...During the year ended December 31, 2021, we saw a significant increase in total Cash App revenue, primarily from bitcoin revenue which contributed 57% of total consolidated net revenue in 2021, and 48% of the total increase in consolidated net revenues in 2021
[0] https://www.sec.gov/Archives/edgar/data/1512673/000162828022...
It seems crypto can have multiple definitions based on what’s most convenient at the time.
Two people there said that, it maybe is transaction fees. But they have asked me to look into the numbers. I think they are right, but I still find the phrasing to be quite ambiguous tbh.
https://www.reddit.com/r/Accounting/comments/tzbg6i/what_is_...