In its annual report filed with the U.S. Securities and Exchange Commission (SEC), fintech giant PayPal disclosed that it held a total of $604 million in various cryptocurrencies on behalf of its customers as of December 31, 2022. The cryptocurrencies held included Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH). Of these, the majority of PayPal users’ cryptocurrency holdings were in Bitcoin, accounting for $291 million in the company’s assets, while $250 million were held in ETH, and $63 million were held in LTC and BCH. This is the first time PayPal has provided a breakdown of its cryptocurrency holdings in its filing, despite launching its crypto features in October 2020.

In the filing, PayPal acknowledged the unique risks associated with cryptocurrencies, including technological, legal, and regulatory risks, and stated that it recognizes a crypto asset safeguarding liability to reflect its obligation to protect the crypto assets held for the benefit of its customers. The company’s cryptocurrency assets are stored with a third-party custodian, which is contractually required to keep customer assets separate and ensure they are not combined with the company’s or any other assets. However, PayPal noted that the effectiveness of these contractual obligations in preventing assets from being considered part of the custodian’s estate in the event of bankruptcy or insolvency cannot be guaranteed, even if the custodian adheres to these obligations.