Jack Dorsey has announced that Square will build a decentralized crypto exchange as part of its TBD project.
A decentralized exchange built on Bitcoin
Last month, Dorsey announced a new Bitcoin-centric division called TBD which was going to focus on DeFi services related to Bitcoin, and today he revealed that what TBD would help with is creating a decentralized exchange for Bitcoin.
Decentralized exchanges are often built on established blockchains, such as Ethereum’s Uniswap and SushiSwap or Solana with Raydium and Mango Markets. TBD intends to create a decentralized exchange built on Bitcoin that offers users a wide range of on-ramps for exchanging fiat currency for BTC.
Mike Brock comments on the announcement
Mike Brock, the general manager of TBD at Square, also commented on the effort today. He stated that there has been “a lot of speculation about what TBD is” and posted a tweet storm describing in detail the potential paths forward as they build the open-source DEX.
Brock points to Cash App and Coinbase as centralized ways to exchange fiat currency for Bitcoin but suggests that they “have a number of issues” and that the global implementation is different. Ultimately, Square wants to create a service that allows users to fund any Bitcoin wallet with fiat currency, even those not hosted by a centralized exchange or service.
He also explained that Bitcoin-based Lightning Network “solves” scalability issues when it comes to payments, but that a similar infrastructure is needed for asset exchanges like stablecoins. The tweet requested help from projects that could help solve current gaps in infrastructure for building TBD.
Square has funded several crypto projects and holds Bitcoin
Square Crypto has funded several crypto projects. It is currently working on an open hardware wallet for Bitcoin, but Unlike Square Crypto, which supports Bitcoin development in general, TBD takes a different approach. Dorsey said the effort would unite Square’s Seller and Cash App services as well as its recently acquired music service, Tidal. There’s no timeline for when Square aims to launch TBD.
Outside its development efforts, Square has invested in Bitcoin. The company currently holds over 8,000 BTC, which equates to about $393 million at current prices.