During the 3rd quarter of 2024, Reddit decided to sell a large part of its cryptocurrencies, including Bitcoins (BTC) and Ether (ETH). However, this shows that the company does not have much of a sense of timing since it was unable to take advantage of the rise in the crypto market in October.
Reddit sells a good portion of its Bitcoins (BTC) before the cryptocurrency market rises
According to a filing this Tuesday with the Securities and Exchange Commission (SEC), the social network Reddit would have sold the majority of its Bitcoins (BTC) a few weeks before its price soared.
“ During the quarter ending September 30, 2024, we sold the majority of our cryptocurrency portfolio, which mainly consisted of Bitcoin and Ether [ETH],” explains Reddit to the American financial regulator.
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The social network indicates that “ the net book value of our cryptocurrencies as well as the gain recognized on the sale were negligible ». Indeed, in the report provided to the SEC, Reddit indicated having sold nearly $6.9 million worth of cryptocurrencies during the 3rd quarter of 2024.
However, Reddit could have obtained up to an additional million dollars if he had allowed himself to wait a few weeks. Indeed, this month of October was particularly positive for the crypto market and in particular for the price of Bitcoin which increased by around 15%.
For now, no additional information has leaked around the amount of Bitcoin and Ether sold by Reddit. Note that the company still has a reserve of cryptocurrencies including at least Ether and Polygon (MATIC).
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For the first time in its history, the social network is profitable
Among the social media giants, Reddit was one of the first to experiment with cryptocurrencies and non-fungible tokens (NFT) as a way to offer collectibles and reward the engagement of its users. However, the social network now seems more moderate on the subject:
Although we think that cryptocurrencies and blockchain technology have significant potentialthe popularity and prevalence of cryptocurrencies is a relatively recent trend, and it is uncertain whether cryptocurrencies and blockchain technology will continue to be adopted by consumers and businesses in the long term.
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This week, Reddit's stock price increased by 48% reaching a price of $116. This increase is explained in particular by the announcement of the quarterly results of the social network which announced revenue of $348.4 million, an increase of 68% compared to Q3 2023.
With a net profit of $29.9 million, the platform became profitable for the first time in its history. This performance is noteworthy since in the first quarter of 2024, Reddit showed a loss of $575 million. The company therefore raised the bar in a few months.
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Source: Securities and Exchange Commission
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Surprised by the rise of crypto-assets at the end of the 2010s, I began to closely follow this sector which fascinates me to the greatest extent. When I'm not in football stadiums, rugby stadiums or handball halls, I work on writing relevant articles around cryptocurrencies and more broadly, Web3.
Zacharie Tazrout
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