PayPal’s crypto holdings increased by 56% in Q1 2023 to nearly $1B

Financial exertion institution PayPal precocious disclosed its cryptocurrency holdings successful a quarterly report filing to the Securities and Exchange Commision (SEC). 

Claiming a combined full of $943 cardinal successful cryptocurrency assets arsenic of March 31, 2023, the filing shows a 56% summation implicit the company’s erstwhile quarter wherever PayPal disclosed $604 million.

PayPal's reported full fiscal liabilities for this 4th were $1.2 billion, with crypto assets making up 77.9% — up much than 10% from 2022’s reported 4th fourth liabilities.

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According to the report, PayPal considers its crypto assets a “safeguarding liability” owed to the the “unique risks associated with cryptocurrencies.” The disclosure besides indicates that the circumstantial cryptocurrencies held by the institution stay unchanged since past quarter:

"We let our customers successful definite markets to buy, hold, sell, receive, and nonstop definite cryptocurrencies arsenic good arsenic usage the proceeds from income of cryptocurrencies to wage for purchases astatine checkout. These cryptocurrencies dwell of Bitcoin, Ethereum, Bitcoin Cash, and Litecoin (collectively, “our customers’ crypto assets”)."

Custody of the assets PayPal holds connected behalf of its customers remains constricted to third-party holding companies. PayPal recognizes that this presents a liability for customers successful the lawsuit that 3rd parties are incapable to process transactions — a connection carried implicit from past quarter’s filing — however, the filing besides indicates that nary specified responsibility has yet occurred:

“As of March 31, 2023, the Company has not incurred immoderate safeguarding nonaccomplishment events, and therefore, the crypto plus safeguarding liability and corresponding safeguarding plus were recorded astatine the aforesaid value.”

The Q1 2023 cryptocurrency plus breakdown for PayPal includes $499 cardinal successful Bitcoin (up from December’s $291 million), $362 cardinal successful Ether (up from $250 million), and $82 cardinal composed of Bitcoin Cash and Litecoin (up from $63 million).

Screenshot of PayPal's quarterly fiscal disclosure.

PayPal's profitability besides accrued successful the archetypal quarter. On a GAAP basis, the institution disclosed per-share net of $0.70, up from $0.43 successful the archetypal 4th of 2022. On a non-GAAP basis, PayPal's per-share net were $1.17, up from $0.88 successful the archetypal 4th of 2022.