Global payment giant PayPal Holdings Inc (NASDAQ:PYPL) invested a significant portion of its financial liabilities in cryptocurrencies such as Bitcoin, as revealed in its recent annual report filed with the US Securities and Exchange Commission (SEC) on Friday.
The report stated that PayPal had a total of $604 million in various cryptocurrencies, incl Bitcoin (CRYPTO: BTC), Ethereum (CRYPTO: ETH), Litecoin (CRYPTO: LTC) and Bitcoin Cash (CRYPTO: BCH).
“Bitcoin holds the largest share of PayPal’s crypto assets, accounting for $291 million, while $250 million is held in ETH. The remaining $63 million includes Litecoin and Bitcoin Cash combined,” according to the report.
The amount of PayPal’s crypto holdings accounted for 67% of the company’s total financial liabilities, which was recorded at $902 million as of December 31, 2022.
On the other hand, PayPal’s total financial assets amounted to more than $25 billion.
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It’s worth noting that this is the first time PayPal included a breakdown of its crypto holdings in its annual financial report, despite offering customers the ability to buy, hold and sell cryptocurrencies for over two years.
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PayPal recognized the unique risks associated with cryptocurrencies, including technological, legal and regulatory risks.
It recognized a crypto-asset protecting obligation to reflect the obligation to protect the assets held for customers.
The company stores its customers’ cryptocurrencies through a third-party custodian, as noted in the filing, but stressed that there could be no assurance that these contractual obligations would be effective in preventing assets from being treated as part of the custodian’s estate in the event of bankruptcy or insolvency.
Previously, PayPal introduced its Bitcoin hold-and-sell service in the US in November 2020 and had sought to integrate various blockchain and crypto services into its platform, including central bank digital currencies, as stated by Vice President Richard Nash.
Read next: Kraken agrees to halt cryptocurrency efforts in SEC settlement
Photo: AdriaVidal via Shutterstock
