Bitcoin surged close to 9% on Wednesday trading over $7,000 according to CoinDesk swinging higher on news of Square Cash piloting a new programme with Bitcoin or the troubles in Zimbabwe.
Dow Jones reported that mobile money transfer service, Square Cash, is piloting a programme to allow a number of users to buy bitcoin directly from its smartphone app. A spokesman for the San Francisco-based company on Wednesday said it is allowing a “small number” of users of Square Cash, its mobile money-transfer service, to buy bitcoin directly from its smartphone app.
Holding and selling bitcoin on platform
“We believe cryptocurrency can greatly impact the ability of individuals to participate in the global financial system, and we’re excited to learn more,” the spokesman said in a statement. He declined to discuss if and when the pilot program would be expanded to all users.
Square will be holding the bitcoins that Square Cash users purchase, similar to the way that it holds the cash balances in Square Cash accounts, according to a person familiar with the matter.
Square Cash users will be able to hold or sell their bitcoin on the platform, but they won’t be able to send bitcoin to one another or use it to buy goods or services at places where the mobile wallet is accepted as a form of payment, the person added.
Zimbabwe upheaval and bitcoin benefit
Word of the experiment started spreading on social media Tuesday night as users noticed the new function added to their app. That helped drive up bitcoin, up at 7.99% on Wednesday, last trading around $7,125 at 1804 UTC, according to CoinDesk.
Political upheaval in Zimbabwe also saw bitcoin benefit as Zimbabweans worried about hyperinflation search for places to store value. According to the Independent, the price for a single bitcoin (up to $13,500 on Wednesday) on Harare’s bitcoin exchange is close to double the price on global bitcoin exchanges due to the country’s liquidity challenges.
“Interest in bitcoin has peaked as people cannot send money outside or pay for international transactions using formal banks,” Yeukai Kusangaya, a trade coordinator at the Golix bitcoin exchange in Zimbabwe, told Quartz.