In the third quarter, the social network Reddit divested its reserves in the leading cryptocurrency and Ethereum, valued at nearly $6.9 million, according to a filing with the SEC report.
“During the three months ended September 30, 2024, we sold most of our portfolio, which was primarily composed of Bitcoin and Ether. The net book value of our cryptocurrencies and the profit from the sale were not significant for the reporting periods,” Reddit stated.
According to the document, these digital assets were held for treasury purposes. Previously, the company invested a portion of excess cash in the two leading cryptocurrencies.
Additionally, it received “insignificant amounts” of Ethereum and POL (then MATIC) from NFT sales.
Reddit also holds digital assets for limited use by engineering and product teams.
The company noted that its cryptocurrency investments are limited to coins that, according to public statements, are not considered securities by regulators. However, this status could be revised at any time.
Among other cryptocurrency-related risks, Reddit highlighted price volatility, cybersecurity threats, and potential “technological obsolescence.”
The company pointed out that U.S. accounting practices negatively impact financial results due to exchange rate fluctuations, which is a negative factor for holding digital assets.
Reddit also expressed concerns about the lack of a clear tax regime for cryptocurrencies.
Earlier, MicroStrategy, with the largest corporate Bitcoin reserves of 252,220 BTC (~$18.2 billion), announced plans to raise $42 billion for further purchases of digital gold.