PayPal’s Crypto Holdings Reach $604 Million: Report
As of December 31, 2022, PayPal, the fintech giant, had $604 million worth of cryptocurrencies in its portfolio
The data was revealed in the company’s annual report submitted to the US Securities and Exchange Commission (SEC).
The report showed that most of the company’s digital assets were in Bitcoin, accounting for $291 million, while Ethereum had $250 million, Litecoin $63 million, and Bitcoin Cash $63 million. This is the first time PayPal has included the details of its cryptocurrency holdings in its filing, even though it introduced its crypto services in October 2020.
PayPal recognizes that cryptocurrencies come with unique risks, including technological, legal, and regulatory risks. As a result, the company has implemented a crypto asset safeguarding liability to protect the digital assets held for the benefit of its customers.
These assets are stored with a third-party custodian, who is contractually obligated to separate customer assets and ensure that they are not combined with the company’s assets or any other assets.
However, the effectiveness of these contractual obligations in case of bankruptcy or insolvency of the custodian cannot be guaranteed, even if the custodian adheres to these obligations.
In its filing, PayPal stated that the inclusion of cryptocurrency holdings in its portfolio accounted for 67% of its total financial liabilities, which amounted to $902 million at the end of the year. The company’s total financial assets stood at over $25 billion.