"We're a payment innovator. And therefore I think it behooves us to always know, where are our payments going?" Friar told "Mad Money" host Jim Cramer on Wednesday. "When we develop products at Square, we spend a lot of time listening to what our customers want, and what we heard from individuals – so this isn't sellers asking to accept bitcoin, this is individuals using Square Cash to make payments ... saying, 'We want an easy way to buy and sell bitcoin.'"
Friar said that companies like hers have no time for academic papers or studies. The fastest way to understand new trends is to actually build products around them, the CFO said.
"You're talking about it, it's out there, and so we want to do an experiment and say, 'OK, is this real? Do customers actually want to be able to do this?'" Friar said. "And then what it does internally is it makes everyone who supports that sort of innovation get to work and figure out how do we do this and do this in the right way?"
Bitcoin, which has surged in popularity and price in 2017, briefly gained over 11 percent on the news. On "Squawk on the Street," Cramer said Square's move would "make people feel better about bitcoin."
And to Friar, the project isn't so much about making a splash as it is about potentially seizing on the next big thing.
"Ultimately, you have to be out there taking some risk and being able to go where innovation is going," she said. "It feels like the early days of the internet or the early days of the shift to the cloud. How many people said, 'We'll never take data outside our data center, that's not safe'?"
"I look at digital currency like that. I don't think we know yet what it's going to be, but I think, absolutely, as an innovator, Square has to be there to let a customer do what they want to do," Friar told Cramer.