AllThingsD's intrepid Tricia Duryee is reporting mobile POS company Square is beating the bushes to raise another round of capital pushing its valuation to $4 billion. According to her report, negotiations are ongoing with a slightly lower valuation possible.

According to Duryee:

"The rumors of Square looking to raise more capital started spreading after Owen Thomas, formerly of the Daily Dot, noticed that [Square CEO Jack Dorsey] and Square’s COO Keith Rabois were in Boston and Baltimore, where many institutional investors are based. Thomas called Legg Mason, which confirmed it was looking at the San Francisco company."

Duryee also runs some numbers to see if she can justify the eye-popping valuation. Her verdict, especially when compared to PayPal at a similar stage: "[T]he valuation is rich beyond belief." (That's similar to an exercise Mobile Payments Today undertook last year with a similar verdict.)

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