Yesterday, the Bitcoin closed just below the $10,000 at $9,995. Today, it has been dancing around the $10,000 level without very much movement.
Bitcoin, and other cryptocurrencies, have suffered from negative news since late December. The negative sentiment weighed heavily on their prices. South Korea implemented new rules to ban any anonymous trading account of the cryptocurrencies and imposed a 24%+ taxe on the exchanges.
Facebook said on Tuesday that it was banning ads that promoted cryptocurrencies.
There is a bright spot among all the negativity. Someone is making money off it. That is Square. Square allows its users to buy up to $10,000 worth of Bitcoin per week. The company said it does not charge a fee for Bitcoin transactions. It makes me wonder how Square makes money off Bitcoin if it does not charge a fee.
Here it is. The price it sells Bitcoin for is based on the average price across other major exchanges. Does this mean Square makes money from the Arbitrage? If Square shows $10,000 as the average sell price on the screen, it can then sell to an exchange which offers $10,300 and pocket the $300 difference? Is this how Square makes money?