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Reddit discloses Bitcoin and Ether purchases using excess cash reserves

By:
on Feb 23, 2024
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  • The social media platform also purchased MATIC for possible use in payments.
  • Reddit says it sees significant potential in cryptocurrencies and blockchain.
  • Reddit is seeking to go public and will be listed on the NYSE

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Popular social platform Reddit invested its excess cash by buying small amounts of Bitcoin (BTC) and Ether (ETH). In a filing with the US Securities and Exchange Commission (SEC), Reddit described its crypto investments as “immaterial.” Reddit added:

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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.

In addition, Reddit said it was experimenting with blockchain technology, purchasing Ether and Polygon (MATIC) for potential use in payments for certain virtual goods. The social platform also revealed that its product and engineering team holds cryptocurrencies.

Sees significant potential in cryptocurrencies

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Reddit expressed a positive view about cryptocurrencies and blockchain technologies as it sees a “significant potential.” It still cautioned that despite the popularity, crypto is a recent trend, and whether the technology will maintain adoption remains uncertain.

The cryptocurrency forays happen when Reddit prepares to go public. The social media platform is popular for intriguing market events such as the GameStop mania in early 2021. During the incident, retail investors on the platform ganged up, buying the heavily shorted stock in turns, forcing a short squeeze.

If approved, Reddit will trade on the New York Stock Exchange under the ticker “RDDT.” The company saw a 20.6% increase in sales in 2023 to $804 million but incurred $90.8 million in net losses.

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