Should I Leave My Bitcoin on Cash App?
We all want a convenient place to put our crypto, and Cash App has recently emerged as a one-stop shop for purchases and storage. It certainly fits the convenience bill — but does that really mean you should leave your bitcoin on Cash App?
Let’s have a quick rundown of the advantages and drawbacks.
The emergence of Cash App
Cash App started offering bitcoin trading back in 2018, positioning itself as the perfect platform for beginners looking to delve into the world of Bitcoin for the first time. To start trading, all users have to do is connect their card — the purchases complete moments later.
Considering the app already has 30 million active users, it had a readymade group of people to target, and it’s now an increasingly large force in the crypto world.
But is it right for you?
As we’ve implied already, the greatest advantage of Cash App is the convenience. If you’re only just dipping your feet into the crypto world, it’s a quick and easy place to get a grip on how things work.
In contrast, setting up your own wallet requires you to know where to go and how to look after your private keys — it can be a daunting process, even if it will technically mean your assets are safer (more on that later). Using something like Cash App also decreases the risk of you accidentally sending your money to the wrong address or falling prey to a scam, which could mean losing your bitcoin forever.
It can also be a sensible choice for someone who plans on using their bitcoin in a few days and wants to store it somewhere temporarily in the meantime.
Holding your bitcoin is not only quick and easy but also gives you the chance to spend on your Cash Card and use the Bitcoin Boost feature to earn more bitcoin. However, you don’t have to keep the bitcoin in your account to harness this benefit.
The biggest drawback to the app? Although you can keep your bitcoin on Cash App, “Square holds your Bitcoin as a custodian at your risk.” Meaning, you won’t have full control over your assets — Cash App maintains that right. In contrast, with self-custody wallets like the Trezor, you are the only one with access to your funds and private keys.
One of the main benefits of bitcoin is that it’s decentralized with no middlemen, unlike banks and most investment products. Yet when you store your bitcoin on Cash App, it invalidates all of that. Go figure.
Although Cash App might be okay for beginners who only want tiny amounts, it’s not the best option for anyone who wants to store substantial sums. Similarly, those who plan to hold it over the long term should look elsewhere.
Overall, it can make sense to use Cash App for your bitcoin if you either want to use it for daily spending or store it temporarily in an easily accessible place. However, we’d advise looking elsewhere if you want to HODL your bitcoin over the long run.
Still not sure if Cash App is the right choice for you and your bitcoin? Schedule your consultation with Bitcoin First Steps. We’re not financial advisors and can’t give you financial advice, but we can talk you through the process of setting up different accounts and point you in the right direction of where to go.