Social media giant Reddit has revealed investments of its excess cash in Bitcoin ($BTC) and Ether ($ETH), placing it among a select group of companies like MicroStrategy and Tesla that hold digital assets directly.
This disclosure came in a filing with the U.S. Securities and Exchange Commission (SEC) as part of the company’s upcoming initial public offering (IPO) on the New York Stock Exchange.
The filing not only confirms Reddit’s crypto holdings but also details the use of ETH and Polygon’ native token $MATIC for certain virtual goods purchases, potentially foreshadowing further integration of blockchain technology within the platform.
While the specific quantity of tokens remains undisclosed, Reddit emphasizes the “immaterial” net carrying value of these digital assets. However, the move also acknowledges potential risks associated with cryptocurrencies, including exchange rate fluctuations, legal and regulatory complexities, and tax implications.
Reddit co-founder Steve Huffman, in the SEC filing, emphasized the IPO’s role in advancing its mission, and highlighted the desire to empower users with ownership, stating that users “have a deep sense of ownership over the communities they create on Reddit,” before adding the firm wants “this sense of ownership to be reflected in real ownership.”
This reflection, he said, is made possible through Reddit’s IPO. The company, which has filed to trade under the ticker “RDDT,” boasts $804 million in sales for 2023, a significant increase from the previous year. Its total assets amount to $1.6 billion, with $1.3 billion in cash reserves.
Reddit’s cryptocurrency holdings see it join a small group of companies that have revealed to have Bitcoin and Ether on their balance sheets. Nasdaq-listed business intelligence firm MicroStrategy is the largest corporate holder of BTC, with 190,000 coins valued at over $9.6 billion in its treasury.
Elon Musk’s electric car maker Tesla has also invested in the flagship cryptocurrency and currently holds 9,720 BTC valued at around $494 million. Its holdings surpass that of cryptocurrency exchange Coinbase, which holds 9,480 BTC worth $482 million.
Featured image via Pixabay.
