Square-parent Block (SQ) on Thursday fired back at short-seller Hindenburg Research amid charges the digital payment company inflates Cash App user metrics and facilitates fraud. SQ stock continued to claw its way back from the deep drop that came with the original report.
In its report, Hindenburg claimed Cash App doesn't have 51 million active monthly users as Square has stated in financial results. Meanwhile, Square published its own report on Thursday providing detailed data on Cash App users.
In its response, Square said: “Cash App is built to support customers who may want to maintain multiple accounts. For example, customers can maintain a separate business and personal account or can also maintain multiple personal accounts (one for everyday personal use and one to set aside funds for budgeting).”
“To us, the response strongly refuted the most pointed allegations,” Jefferies analyst Trevor Williams said in a note to clients. “(Square said) of the 51 million monthly actives, 44 million have verified identities. And, of the 44 million, 39 million have unique SSNs (Social Security numbers), refuting that the user base is awash with dupes.”
Leave a Reply