Global payment giant PayPal held $604 million of cryptocurrencies for its customers by the end of 2022, with Bitcoin and Ethereum accounting for almost 90% of that figure.
The company’s crypto holding of $604 million at the end of 2022 is down from the $690 million the company held as of September. The drop comes amid plunging crypto prices and exacerbating user trust in the industry following the disastrous collapse of cryptocurrency exchange FTX.
The amount of PayPal’s crypto holdings account for 67% of the company’s total financial liabilities, amounting to $902 million as of December 31. As per the filing, the company’s total financial assets stood at more than $25 billion, according to the filing.
“Due to the unique risks associated with cryptocurrencies, including technological, legal, and regulatory risks, we recognize a crypto asset safeguarding liability to reflect our obligation to safeguard the crypto assets held for the benefit of our customers.”
PayPal further detailed that they store customers’ digital assets through a third-party custodian. The company noted that it contractually requires the custodian to segregate customer assets and not mix them with proprietary or other assets, adding:
“We cannot be certain that these contractual obligations, even if duly observed by the custodian, will be effective in preventing such assets from being treated as part of the custodian’s estate under bankruptcy or other insolvency law.”
