Reddit has significantly reduced its cryptocurrency holdings during the third quarter, missing Bitcoin’s notable surge in October, which saw prices reach a high of $73,569—only $168 shy of its all-time peak.
According to an SEC filing released yesterday, the social media platform sold off the majority of its Bitcoin and Ethereum assets. The sell-off probably occurred while Bitcoin was trading between $54,000 and $68,000.
“During the three months ended September 30, 2024, we sold the majority of our cryptocurrency portfolio, which consisted primarily of Bitcoin and Ether,” the 10-Q SEC filing says.
“The net carrying value of our cryptocurrencies, as well as the gain recognized on sale, was immaterial for the periods presented.”
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Reddit Invests Excess Cash In Bitcoin And Ethereum
Starting in 2022, Reddit has been investing some of its excess cash reserves in Bitcoin and Ether. It also continued to acquire ETH and Polygon’s token MATIC — now known as POL — as a “form of payment for sales of certain virtual goods.”
In a previous filing for its initial public offering (IPO), the company praised crypto and blockchain as having “significant potential.” The company has also historically been engaged with cryptocurrency.
The platform was an early adopter of community tokens, such as Moons, and incorporated Polygon-based Collectible Avatars to enhance user interaction through blockchain technology.
Despite its previous innovations in the crypto space, Reddit appears to be retreating from these initiatives.
The company’s updated investment policy now mandates board approval for any future crypto purchases. This limits potential acquisitions to Bitcoin, Ethereum, or other assets unlikely to be classified as securities.
The pivot coincides with a reported decline in advertising revenue across key sectors, including technology and cryptocurrency, influenced by economic uncertainty, rising interest rates, and geopolitical tensions.
“Since the three months ended December 31, 2022, we experienced declines in advertising spending in certain macro-challenged sectors, particularly technology, media and entertainment, and cryptocurrency,” the company wrote.
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Bitcoin Price Surges Above $72,000 Amid Growing Interest In Spot ETFs
On Thursday, Bitcoin surged above $72,000, inching closer to its all-time high of around $73,000 recorded in mid-March this year.
Bitcoin has already achieved new all-time highs against various global currencies, including the euro. Market analysts increasingly believe that a return to US dollar price discovery for Bitcoin is imminent.
William Clemente, co-founder of Reflexivity, noted that those who invested in the iShares Bitcoin Trust (IBIT) ETF are now in profit. This investment allows them to promote IBIT to others who recently witnessed gold’s significant price movement.
All of the suits who aped the ETF are now in profit and can start shilling IBIT to their other suit friends who just watched gold go on an insane move into price discovery pic.twitter.com/4Du39UM6Sp
— Will (@WClementeIII) October 30, 2024
The IBIT ETF, managed by BlackRock, saw net inflows of $875 million on 30 October 2024. This signals strong interest in Bitcoin investment.
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