<img src="https://cryptoslate.com/wp-content/uploads/2024/02/reddit-bitcoin–ethereum.jpg” />
Social media giant Reddit has been quietly purchasing bitcoin and ethereum with some of its excess cash and is keeping an undisclosed amount of the two tokens in its treasury for investment purposes.
Details of the social media giant's cryptocurrency exposure were revealed in its initial public offering (IPO), which was filed with the SEC on February 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 of the offering. However, it is expected to be one of the biggest tech IPOs of the year.
crypto Expo
The filing clarifies that Reddit's cryptocurrency holdings are limited to bitcoin and ethereum, both established players in the crypto space. The revelation was somewhat surprising, considering the company's cautious approach to cryptocurrencies in recent years.
According to the document, Reddit's board of directors approved the investment policy, which focuses on “risk mitigation” by only investing in cryptocurrencies that regulators consider “not likely to be a security.”
The filing did not reveal the amount of bitcoin and ethereum held in treasury or how long the company has been purchasing them.
While the disclosed cryptocurrency holdings are limited to treasury purposes, the filing also mentions that Reddit had acquired Ether and Matic for the sale of virtual goods. He added that the amounts were “immaterial” in recent years.
The presentation recognizes the inherent risks associated with cryptocurrencies, including volatility, cybersecurity threats, and potential regulatory changes. It also highlights the accounting challenges posed by the treatment of cryptocurrencies as indefinite-lived intangible assets and upcoming changes to accounting standards.
Digital infrastructure
Reddit's IPO filing hinted at broader ambitions to integrate blockchain technology into its vast network of forums and discussions. He outlined the platform's ongoing efforts to diversify its revenue streams and improve its digital infrastructure, with cryptocurrencies playing a crucial role in this strategy.
The presentation also mentions the exploration of decentralized applications (dApps) and the potential of blockchain to offer new ways of creating, sharing and owning content. He also emphasized blockchain's potential to improve user experience and create new avenues for community engagement and monetization.
Reddit's IPO filing offers a glimpse of 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 potential for future growth and innovation in this space.
