Learn how PayPal and Tesla, two major corporations, embrace cryptocurrencies by holding digital coins and providing services using them. Explore their cryptocurrency holdings and the implications for the crypto market.
As time goes on, more major corporations embrace cryptocurrencies by keeping digital coin holdings in their wallets or continuing to provide services using them, like PayPal and Tesla.
In this article, we take a close look at the cryptocurrency holdings of PayPal, a market leader in online payments, as well as Tesla, run by billionaire entrepreneur Elon Musk.
PayPal has approximately $1 billion in cryptocurrency assets
The Securities and Exchange Commission (SEC) received PayPal’s quarterly 10-Q report, which said that it held almost $1 billion in cryptocurrency holdings.
The corporation specifically revealed that it possessed assets worth $943 million in total, including Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), and Litecoin (LTC).
PayPal’s portfolio of cryptocurrency assets has grown by $339 million since the end of last year. In truth, the following is stated in PayPal’s 10-Q:
The organization keeps internal records of the percentage of cryptocurrency assets owned by its clients, as well as the quantity and variety of assets that each client possesses.
It is important to note that no other cryptocurrency holdings by the corporation were discovered, excluding the ones held by its clients.
Additionally, we find that PayPal has implemented a “protection” policy for users in respect to “all buying or selling activity” up to a limit of $50,000, as defined in its terms and conditions, despite the fact that there is still no special regulatory protection for cryptocurrency investors in the United States.
PayPal introduced all cryptocurrency-compliant functionality
PayPal, a corporation that handles payments, has recently added a number of cryptocurrency-related capabilities.
For instance, it gave clients more autonomy over the administration of their money in July 2022 by enabling them to transfer their cryptocurrency assets to outside wallets.
Additionally, PayPal added support for cryptocurrency exchange on Venmo, a well-known mobile payment app in the US.
Customers were able to do this to transfer their cryptocurrency to external wallets, benefiting from a new ecosystem and enabling transactions on various applications.
It’s also crucial to remember that ConsenSys incorporated the capability to buy Ethereum using PayPal in December 2022, giving users a practical means to do so.
Tesla and the $184 million Bitcoin position on the balance sheet
Elon Musk’s well-known electric vehicle company Tesla reported that its Bitcoin holdings remained steady in the first quarter of 2023 and that no modifications were made.
In fact, the value of crypto assets held by Tesla in the first quarter of 2023 was $184 million, the same as it was in the fourth quarter of 2022, according to the most recent publication of financial figures.
It is significant to remember that this steady valuation is based on current accounting standards, which prohibit the recording of capital gains.
The price of Bitcoin has surged during the time period under review, rising from $16,500 in December to around $25,000 right now.
In other words, Tesla kept the same amount of Bitcoin in its possession for the third consecutive quarter during the first quarter of 2023.
Tesla reported adjusted earnings per share (EPS) of 85 cents for its shares.
However, revenue came in at $23.33 billion as opposed to the projected $23.6 billion, which was less than expected.
It’s important to keep in mind that Tesla initially bought Bitcoin for $1.5 billion in February 2021, which eventually rose to roughly $2.5 billion.
However, the business only sold around three-quarters of that amount in the second quarter of 2022.
Following that, Tesla had a total of $218 million in Bitcoin, however it experienced losses as a result of the asset’s volatility and its own sales.
Some people have criticized this string of actions as being “inconsistent.” Although Tesla had accepted Bitcoin as payment, it later stopped doing so because of the negative effects the cryptocurrency’s mining process had on the environment.
For some of its items, Tesla only currently takes Dogecoin (DOGE) as a cryptocurrency.