Square Launches Bitcoin Payments for Merchants

In a bold move that signals growing confidence in cryptocurrency as a medium of exchange, Square (a subsidiary of Block, Inc.) has announced the rollout of Square Bitcoin (BTC) — an integrated payments and wallet solution that allows merchants to accept and manage BTC directly from their point-of-sale systems. 

Overview

On October 8 2025, Square announced that its new BTC feature enables merchants to accept BTC payments and automatically allocate part of their sales into the crypto. The company will waive all processing fees until the end of 2026, after which a 1% transaction fee will apply starting January 1 2027.  The timing and structure of the launch reflect both rising demand for crypto-based commerce and Square’s ambition to make BTC more usable in everyday retail settings.

What Square Bitcoin Offers Merchants

Square BTC combines three core features into one seamless interface: BTC Payments, BTC Conversions, and a native BTC Wallet — all built into the existing Square ecosystem. 

• Bitcoin Payments: Merchants can accept BTC payments at the point of sale, with zero processing fees for the first year. This fee waiver is part of a promotional launch period intended to lower friction for adoption. 
• Bitcoin Conversions: Businesses can opt to automatically convert a portion of their daily card sales (up to 50 %) into BTC, helping them diversify their holdings without extra steps. 
• Bitcoin Wallet: The system integrates a full wallet with buying, selling, holding, and withdrawal functions — all accessible through merchants’ existing Square dashboards. 

Merchants will also have the choice of receiving settlements in BTC or fiat currency (US dollars), giving flexibility in how they manage volatility. 

Timing and fees: The BTC Payments feature will become available starting November 10, 2025. After the promotional period, starting January 1, 2027, a 1 % processing fee will apply. 

Why This Matters: Crypto Use in Commerce

Square’s move is more than a product launch — it’s a bet on the next chapter of crypto adoption. Several trends help explain the logic behind it:

• Rising consumer demand for crypto payments: Projections suggest the number of users paying with cryptocurrencies in the US could grow by as much as 82% between 2024 and 2026. 
• Reducing friction for merchants: One of the persistent barriers to merchant crypto adoption has been complexity — separate wallets, manual conversions, and uncertainty about accounting or volatility. By embedding these functions into a familiar payments stack, Square is removing much of that friction. 
• Cost competitiveness: Even after instituting a modest processing fee from 2027, Square’s fee is expected to remain below the cost of many traditional card transactions (~2.6% + fixed fees). 
• Strategic alignment with Block’s crypto strategy: Square’s offering complements Block’s broader BTC ecosystem (Cash App’s crypto features, self-custody tools, mining-related initiatives).

Square is effectively trying to normalise crypto at the cash register, shifting perception away from BTC as merely a speculative asset and toward a functional payments instrument.

Challenges & Outlook

Despite the momentum, several risks and hurdles remain in Square’s path to mainstream merchant adoption:

• Volatility & settlement risk: Bitcoin’s price swings make settlement strategies and treasury management more complex for merchants unaccustomed to crypto exposure.
• Regulatory uncertainty: Crypto regulation is in flux worldwide, and Square’s features may face constraints in certain jurisdictions. Notably, Square BTC will not initially be available to sellers outside the US or in states like New York.
• Education & trust: Many small merchants may still be unfamiliar with or doubt crypto. Incentives like zero fees are helpful, but awareness and training will be necessary.
• Adoption speed: Even with the lower barrier, converting crypto-curious merchants into actual users may take time, especially in sectors with thin margins or where traditional payments are deeply entrenched.
• Technical integration and UX: Ensuring that the user experience is smooth and reliable (e.g. minimising delays, errors, and accounting headaches) will be critical for acceptance.

In the coming years, Square’s aggressive push could prompt competing payment platforms to offer similar crypto features, potentially accelerating a shift in how we think about digital currency and commerce. For merchants, the choice to enable Bitcoin payments may increasingly be seen not as a novelty but as a competitive edge in an evolving payments landscape.