According to data released by Invezz.com, that technically means that PayPal is in the third largest Bitcoin traffic of any public company.
Yes ok the amount of Bitcoins held was not disclosed in the report, the dollar value reached 250 million dollars. With Bitcoin trading at $16,600 at the end of the year, it can be estimated that the company had approximately 17,500 Bitcoin.
In terms of known public companies, that would put PayPal behind only microstrategy (132,500 BTC) and Galaxy Digital (40,000 BTC). Of course the difference is that PayPal has not invested in Bitcoin, it just holds it as a liability.
Furthermore, PayPal does not own the Bitcoin itself, but stores the Bitcoin through a third-party custodianaccording to the report.
Interestingly, PayPal made it a point to clarify that this was not without riskas the report came shortly after the cryptocurrency industry was rocked by the collapse of FTXthe old exchange between the main 3, which lost $8 billion in client assets. Its CEO has been arrested and is currently under house arrest.
In another nod to the chaos that has plagued the cryptocurrency industry over the past year, PayPal explained why this was the first time it had included a breakdown of its cryptocurrency holdings.. “Due to risks Uniquely associated with cryptocurrencies, including technological, legal and regulatory risks, we recognize a responsibility to safeguard crypto assets to reflect our obligation to safeguard crypto assets held for the benefit of our clients.”
PayPal had plans to move further into the cryptocurrency industry. He had been exploring launching his own stablecoin.
Its senior vice president of cryptocurrency and digital currencies had previously said that PayPal “has yet to see a stablecoin that is specifically designed for payments,” telling Bloomberg that “we are exploring a stablecoin”. As long as we look to move forward, of course, we will work closely with the regulators.”
However, it seems that the issue of regulation has abruptly ended those plans. The company reportedly pulled the plug after Paxos, the issuer of the Binance-branded BUSD stablecoin, was ordered to stop minting new stablecoins. It is also being sued by the SEC for breaches of securities law.
The PayPal’s interactions with cryptocurrency nicely symbolize just how shady both security and regulation are in the sector of rapid participation.
The company felt the need to break down its holdings and warn about the risks of third party custody after the chaos of the multitude of bankruptcies last year, with clients still reeling and asset safety front and center.
In tune with tech, PayPal had a bad 2022
Like most tech companies, 2022 was a year to forget for PayPal. The sector is especially sensitive to interest rate policy, and with the Federal Reserve raising rates at a rapid pace, the industry has been restricted.
He PayPal stock price increased during the pandemic years of 2020 and 2021howeverlost 77% of its value between July 2021 and July 2022, falling from $309 per share to $69. It announced two weeks ago that it would lay off 2,000 employees, 7% of its workforce, as part of the wave of layoffs sweeping the sector.
It is currently trading at $80 a share, and investors are enjoying some relief so far this year as the market bets interest rates will decline sooner than expected.
Source: Ambito
