Playboy’s parent company, PLBY Group, lost $4.9 million in company-owned Ethereum. This loss was caused by the decline of the cryptocurrency market over the past two years.
The PLBY Group accepted Ethereum as payment for its non-fungible “Rabbitars” tokens (NFTs), and these Ethers were added to the company’s balance sheet as digital assets.
Playboy loses to Ethereum
Playboy considers these digital assets to be “intangible assets with indefinite lives,” meaning they are subject to deterioration if their current value falls below their book value.
Is the value of Ethereum falling? Then the company suffers a loss. Interestingly, the company cannot reverse this loss, even if the value rises again over time.
Profit only on sale
The price of Ethereum fluctuated between $964 and $3,813 until December 31, 2022. For Playboy, however, only the lowest price counted. The book value of each Playboy Ethereum was valued at the lowest price recorded on an active exchange since it was received. This means that if the price of Ethereum falls, the company will suffer a loss.
Only if Playboy sells the ethers and the price is higher than the purchase price at that time can it be entered as a profit in their books.
Bad timing to accept Ethereum
In October 2021, the company launched the NFT project “Rabbitar”. At that time, the cryptocurrency market was at its peak. Unfortunately, Ethereum’s value has fallen by about 60% since then.
In October 2021, Ethereum was at 3,825 euros and thus on its way to 4,000 euros. However, the value has dropped to 1650 euros. Historically it is still a nice amount, but much less of course.
That’s the risk of jumping at the height of the hype.
Playboy got in touch with NFT and blockchain technology in early 2021 with the Liquid Summer NFT collection, launched in May, consisting of digital artwork created in collaboration with artist Slimesunday.
The company has been accepting bitcoin payments on Playboy TV and Playboy.com since 2018.
Source: Btc Direct
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
