BTC and ETH account for the largest share of PayPal’s crypto assets, accounting for $291 million and $250 million respectively in the asset breakdown.
Global payments giant PayPal holds a significant portion of its financial liabilities in cryptocurrencies such as Bitcoin
offered to its customers.
As of December 31, PayPal held a total of $604 million in various cryptocurrencies, including Bitcoin, Ether
and Bitcoin Cash
, according to an annual report filed with the United States Securities and Exchange Commission on February 10.
Bitcoin has the largest share of PayPal’s crypto assets, accounting for $291 million in the company’s asset structure, while $250 million is held in ETH. The remaining $63 million includes Litecoin and Bitcoin Cash combined.
The value of PayPal’s crypto holdings represents 67% of the company’s total financial liabilities, which amount to $902 million as of December 31. PayPal’s total financial assets were more than $25 billion, according to the filing.
Despite introducing cryptocurrencies to its platform more than two years ago, PayPal did not include a similar analysis of cryptocurrencies in its previous annual financial report.
“Due to the unique risks associated with cryptocurrencies, including technological, legal and regulatory risks, we recognize a responsibility to protect crypto assets that mirrors our obligation to protect crypto assets held for the benefit of our customers,” PayPal wrote in a recent filing. .
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PayPal stores customers’ cryptocurrencies through a third-party custodian, the company said in a filing. PayPal emphasized that the contract requires the custodian to segregate customer assets and not commingle them with property or other assets, adding:
“We cannot be certain that these contractual obligations, even if properly complied with by the custodian, will be effective in preventing such assets from being treated as part of the custodian’s assets under bankruptcy or insolvency law.”
As previously reported, PayPal launched its Bitcoin storage and selling service in the United States in November 2020. The company has done its best to introduce all possible blockchain and crypto integrations into its services, including central bank digital currencies, said Vice President Richard Nash.