What Reddit's Filing Reveals About Crypto

 

Popular social media site Reddit is as dynamic in its investments as it is in its avatar offerings.

After taking the step towards launching its IPO, the pioneering internet company went public only the last week. Its filing with the Securities and Exchange Commission (SEC) reveals that the company has invested in new-age assets, keeping in line with its future-ready vision.

As per Reddit’s SEC filing, the company has invested in cryptocurrency, specifically Bitcoin (BTC), Ether (ETH) and Polygon (MATIC). However, it didn’t disclose the amount it has invested in digital assets.

The company reported its 2023 revenue to be $804 million, a rise of 21% from $666.7 million in 2022.

• Gross margin for 2023 was 86%, up from 84% in 2022.
   
• Net loss was $90.8 million in 2023, down from a $158.6 million loss in 2022.
   
• Meanwhile, the platform’s user base has grown to 73.1 million daily active users in the fourth quarter of 2023, up 27% year over year.

It also emerged that Sam Altman, CEO of OpenAI (the artificial intelligence company that owns ChatGPT), holds more than 5% of its capital stock. The investment grants Altman 9.2% voting power.

Underscoring the importance of the community, Reddit has reserved a significant portion of its shares for its “users and moderators.”

Users are those participants who contribute content to the different communities known as Subreddits. Moderators are those who manage the communities and enforce content moderation as per the rules and regulations set forth.

What Reddit Assumes About Crypto

Reddit says in its filing that it has assumed that ETH isn’t a security, though it has based its determination on risk-based judgements.

The company also underlined the risks that may prevent it from accessing or trading its crypto holdings.

Nonetheless, Reddit is betting on crypto despite these risks.