Despite the fact that Square is moving a whole lot of money, $4 billion is still a very high valuation. A good comparison is PayPal, which went public at a valuation of $800 million and was sold to eBay for $1.5 billion shortly thereafter. As AllThingsD reports, “At the time it went public, the company was roughly doubling year-over-year and had generated $103.7 million in 2001, its first full-year of operations — or slightly less than Square’s estimated revenues.”

Still, Square is doing extremely well, even if it does have some tough competition to face in Google and its Wallet service and others, such as PayPal. Hopefully before long, we’ll know if it’s doing well enough to warrant a $4 billion valuation, and we’ll to see what it’ll do with the funding it receives.