Reddit IPO filing reveals treasury exposure to Bitcoin, Ethereum – CryptoSlate
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The global crypto market cap is $1.96 trillion with a 24-hour volume of $74.02 billion. The price of Bitcoin is $51,288.96 and BTC market dominance is 51.3%. The price of Ethereum is $2,965.30 and ETH market dominance is 18.2%. The best performing cryptoasset sector is Storage, which gained 9%.
The filing did not disclose the amount of Bitcoin and Ethereum held in the treasury or how long the company has been buying them.
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Social media giant Reddit has been quietly buying Bitcoin and Ethereum with some of its excess cash and holds an undisclosed amount of the two tokens in its treasury for investment purposes.
The social media giant’s crypto exposure details were revealed in its initial public offering (IPO) prospectus, which was filed with the SEC on Feb. 22. The filing comes after months of speculation about the company’s plans to go public.
The company did not disclose how many shares it plans to sell or the price range for the offering. However, it is expected to be one of the largest tech IPOs of the year.
The filing clarifies that Reddit’s crypto holdings are confined to Bitcoin and Ethereum, both established players in the crypto space. The revelation was somewhat of a surprise, considering the company’s cautious approach toward crypto in recent years.
According to the document, Reddit’s board of directors has approved the investment policy, which focuses on “risk mitigation” by only investing in cryptocurrencies deemed “not likely to be a security” by regulatory bodies.
The filing did not disclose the amount of Bitcoin and Ethereum held in the treasury or how long the company has been buying them.
While the disclosed crypto holdings are limited to treasury purposes, the filing also mentioned that Reddit had acquired Ether and Matic for virtual goods sales. It added that the amounts were “immaterial” in recent years.
The filing acknowledges the inherent risks associated with cryptocurrencies, including volatility, cybersecurity threats, and potential regulatory changes. It also highlights the accounting challenges posed by treating cryptocurrencies as indefinite-lived intangible assets and the upcoming changes in accounting standards.
Reddit’s IPO filing hinted at broader ambitions to integrate blockchain technology into its expansive network of forums and discussions. It described the platform’s ongoing efforts to diversify its revenue streams and enhance its digital infrastructure, with cryptocurrencies playing a crucial role in this strategy.
The filing also mentioned exploring decentralized applications (dApps) and the potential for blockchain to offer new forms of content creation, sharing, and ownership. It also emphasized the potential of blockchain to enhance user experience and create new avenues for community engagement and monetization.
Reddit’s IPO filing offers a glimpse into a social media giant cautiously embracing the world of cryptocurrencies. While the company’s current exposure is limited, its openness to experimentation and focus on regulatory compliance suggests a potential for future growth and innovation in this space.
AJ, a passionate journalist since Yemen’s 2011 Arab Spring, has honed his skills worldwide for over a decade. Specializing in financial journalism, he now focuses on crypto reporting.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Polygon, a prominent layer 2 scaling solution on Ethereum, has emerged as a multifaceted and scalable platform, enhancing the Ethereum ecosystem’s capabilities.
Reddit is a social news aggregation, conversation, and content-rating website based in the United States.
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