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PayPal’s Cryptocurrency Holdings Surge by 56% in Q1 2023 to Reach $943 Million

Financial technology company PayPal has disclosed its cryptocurrency holdings in a quarterly report filed with the United States Securities and Exchange Commission (SEC). The report revealed that PayPal’s total cryptocurrency assets amounted to $943 million as of March 31, 2023, representing a 56% increase from the previous quarter’s disclosed $604 million.

PayPal’s cryptocurrency assets accounted for 77.9% of its total financial liabilities for the quarter, with the report categorizing them as “safeguarding liabilities” due to the unique risks associated with cryptocurrencies. PayPal has not changed its cryptocurrency holdings since the previous quarter and its custody of the assets remains limited to third-party holding companies. The disclosure recognizes that this presents a liability for customers in the event that third parties are unable to process transactions. However, the company has yet to incur any safeguarding loss events.

PayPal’s cryptocurrency asset breakdown for Q1 2023 includes $499 million in Bitcoin, $362 million in Ether, and $82 million in Bitcoin Cash and Litecoin combined. The report also revealed that PayPal’s profitability increased in the first quarter, with the company disclosing per-share earnings of $0.70 on a generally accepted accounting principles (GAAP) basis and $1.17 on a non-GAAP basis.

Source: Paypal

The company allows customers in certain markets to buy, hold, sell, receive, and send cryptocurrencies and use the proceeds from sales to pay for purchases at checkout. PayPal’s disclosed cryptocurrency holdings indicate the company’s growing interest and investment in the digital asset space. However, it remains to be seen how PayPal will continue to navigate the unique risks associated with cryptocurrencies and its impact on the company’s financial performance.

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