Fintech payments company Block (SQ) is down 17% after being the subject of the latest attack from notable short seller Hindenburg Research.
Block was founded and is led by former Twitter (TWTR) CEO Jack Dorsey. An outspoken proponent of Bitcoin (BTC), Dorsey has led Block into offering bitcoin purchases and the development of a bitcoin wallet and mining rigs.
Bitcoin revenues, however, remain a small part of Block's overall business, which is dominated by the company's Cash App, and which is the focus of the Hindenburg report.
Hindenburg continued: "Our research indicates, however, that Block has wildly overstated its genuine user counts and has understated its customer acquisition costs. Former employees estimated that 40%-75% of accounts they reviewed were fake, involved in fraud, or were additional accounts tied to a single individual."
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