Social platform Reddit has revealed its investments in Bitcoin (BTC) and Ethereum (ETH) as it looks to go public, a filing with the Securities and Exchange Commission has revealed.
Reddit also revealed it was experimenting with Ether and Matic as a form of payment mode for the sale of virtual goods.
BTC, ETH Investments
The platform revealed it had added Bitcoin and Ethereum to its balance sheet in a filing for an Initial Public Offering (IPO), stating it had invested a portion of its excess cash reserves into purchasing the world’s two leading cryptocurrencies. However, Reddit did not reveal how much it had invested into its purchase. It also revealed that it had purchased Polygon (MATIC) to pay for virtual goods. The platform stated in its filing,
“We invested some of our excess cash reserves in Bitcoin and Ether and also acquired Ether and Matic as a form of payment for sales of certain virtual goods, which we may continue to do in the future.”
The platform clarified that Bitcoin and Ether were the only cryptocurrencies it held in its treasury as of the 31st of December, 2023, but added that the amounts were immaterial.
“The net carrying value of our cryptocurrencies, which consisted primarily of Bitcoin and Ether, as well as all related cryptocurrency activity, was immaterial for the periods presented.”
ETH And MATIC As A Form Of Payment
Reddit also revealed that it had been experimenting with blockchain technology by purchasing ETH and MATIC as a form of payment for the sale of specific virtual goods. It added that the MATIC and ETH it received were not material across 2022 and 2023 but that it may continue to use the two as a payment method. The company said its product and engineering teams hold cryptocurrencies for specific uses but did not specify which cryptocurrencies or the amount.
Significant Potential In Blockchain-Related Technologies
Reddit also stated that it saw considerable potential in blockchain-related technologies but added that it wasn’t sure if business and consumer adoption of the technologies would continue.
“While we believe cryptocurrencies and blockchain technology have significant potential, the popularity and prevalence of cryptocurrencies is a relatively recent trend, and whether cryptocurrencies and blockchain technology will continue to be adopted by consumers and businesses in the long term is uncertain.”
Reddit’s S-1 registration revealed that Reddit recorded $90.8 million in net losses in 2023, although its revenue reported an increase of 20.6% to $804 million year-on-year. Reddit was valued at $10 billion after its 2021 funding round. However, a Bloomberg report published on the 28th of January stated that it may now attain half of its 2021 valuation.
Reddit shut down its blockchain-based rewards service, which rewarded users with points for positive engagement in specific subreddits. The company cited scalability concerns as the reason for the shuttering.
No Stranger To Digital Assets
Reddit is no stranger to digital assets, having dabbled with them since 2020 when it launched Moon and Bricks, tokens running on Ethereum’s testnet. It also launched an NFT avatar initiative on Polygon, selling and giving away customized versions of the Snoo mascot in collaboration with artists.
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Source: https://cryptodaily.co.uk/2024/02/reddit-sec-filing-reveals-bitcoin-ethereum-investment