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Fair Value Measurement Of Assets And Liabilities
 12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value Measurement Of Assets And Liabilities Fair value measurement of assets and liabilities
Assets and liabilities measured and recorded at fair value on a recurring basis
The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2022 and 2021:
DescriptionBalances as of
December 31, 2022		Quoted Prices in
active markets for
identical Assets
(Level 1)		Significant other
observable inputs
(Level 2)		Unobservable
inputs
(Level 3)		Balances as of
December 31, 2021		Quoted Prices in
active markets for
identical Assets
(Level 1)		Significant other
observable inputs
(Level 2)		Unobservable
inputs
(Level 3)
(In millions)
Assets
Cash and Cash Equivalents:
Money Market$599 $599 $— $— $1,079 $1,079 $— $— 
U.S. government debt securities (1)21 21 — — — — — — 
Foreign government debt securities (1)— — — — 16 16 — — 
Restricted Cash and Cash Equivalents:
Money Market352 352 — — 210 210 — — 
Foreign government debt securities (Central Bank of Brazil Mandatory Guarantee) (1)158 158 — — 296 296 — — 
Investments:
U.S. government debt securities (1)733 733 — — 150 150 — — 
Foreign government debt securities (Central Bank of Brazil Mandatory Guarantee) (1)1,219 1,219 — — 602 602 — — 
Foreign government debt securities (1) (2)214 214 — — 78 78 — — 
Other Assets:
Derivative Instruments1 — 1 — 17 — — 17 
USDC3 3 — — — — — — 
Customer crypto-assets safeguarding assets15 — 15 — — — — — 
Total Assets$3,315 $3,299 $16 $— $2,448 $2,431 $— $17 
Liabilities:
Long-term retention plan$58 $— $58 $— $103 $— $103 $— 
Other Liabilities:
Contingent considerations8 — — 8 9 — — 9 
Derivative Instruments24 — 24 — 6 — — 6 
Customer crypto-assets safeguarding liabilities15 — 15 — — — — — 
Total Liabilities$105 $— $97 $8 $118 $— $103 $15 
(1)Measured at fair value with impact on the consolidated statement of income for the application of the fair value option. (See Note 2 – Fair value option applied to certain financial instruments.)
(2)
As of December 31, 2022 and 2021 includes $21 million and $13 million, respectively, of investments from securitization transactions that are restricted to the payment of amounts due to third-party investors. (See Note 5 - Cash, cash equivalents, restricted cash and cash equivalents and investments.)
As of December 31, 2022 and 2021, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis were valued using i) Level 1 inputs: unadjusted quoted prices in active markets (Level 1 instrument valuations are obtained from observable inputs that reflect quoted prices (unadjusted) for identical assets in active markets); ii) Level 2 inputs: obtained from readily-available pricing sources for comparable instruments as well as instruments with inactive markets at the measurement date; and iii) Level 3 inputs: valuations based on unobservable inputs reflecting Company’s assumptions. The unobservable inputs of the fair value of derivative instruments and contingent considerations classified as Level 3 refer to the prevailing risk free interest rate and spot exchange rate, and to the amounts to be paid according to the respective agreements of each acquisition, the likelihood of achievement of the performance targets arising from each one (expected to be 100%), as well as the Company’s historical experience with similar arrangements. Reasonable variation on those unobservable inputs would not significantly change the fair value of those instruments.
The following tables summarize the reconciliation of the financial assets and liabilities measured at fair value using Level 3 inputs as of December 31, 2022 and 2021:
Year Ended December 31, 2022
Derivative Instruments, netContingent Considerations
(In millions)
Balance, beginning of the year$11 $(9)
Net Additions3 — 
Settlements7 1 
Foreign Currency Translation(5)— 
Losses in Other Comprehensive Income(15)— 
Losses in Income Statement(28)— 
Transfers out of level 327 — 
Balance, end of the year$— $(8)

Year Ended December 31, 2021
Derivative Instruments, netContingent Considerations
(In millions)
Balance, beginning of the year$(14)$(5)
Net Additions3 (4)
Settlements14 — 
Foreign Currency Translation(3)— 
Gains in Other Comprehensive Income11 — 
Balance, end of the year$11 $(9)
The Company’s election of the fair value option applies to the: i) Brazilian federal government bonds and ii) U.S. treasury notes. As a result of the election of the fair value option for the investments held as of December 31, 2022 and 2021, the Company recognized fair value gains in interest income and other financial gains for $29 million and $9 million, respectively.
As of December 31, 2022 and 2021, the Company held no investment in corporate debt securities which are classified as available for sale. However, during the year ended December 31, 2022, the Company purchased and sold these kind of instruments, being the proceeds from the sales $156 million and the gross realized gains less than $1 million. The cost of these securities was determined under a specific identification basis.
Financial assets and liabilities not measured and recorded at fair value
As of December 31, 2022 and 2021, the carrying value of the Company’s financial assets (except for loans receivable) and liabilities (except for the 2026, 2028 and 2031 Notes) not measured at fair value approximated their fair value mainly because of their short-term maturity. These assets and liabilities included short and long-term investments (excluding money markets and U.S. and foreign government debt securities), accounts receivable, credit card receivables and other means of payments, other assets (excluding derivative instruments and USDC), accounts payable and accrued expenses, funds payable to customers, amounts payable due to credit and debit card transactions, salaries and social security payable (excluding variable LTRP), taxes payable, loans payables and other financial liabilities (except for the 2026, 2028 and 2031 Notes) and other liabilities (excluding variable LTRP, contingent considerations and derivative instruments). If these financial instruments were measured at fair value in the financial statements, cash and restricted cash would be classified as Level 1 (where cost and fair value are aligned) and the remaining financial instruments would be classified as Level 2.
As of December 31, 2022 and December 31, 2021 the estimated fair value of the loans receivables, which is based on Level 3 inputs, is $1,761 million and $1,260 million, respectively, and were determined based on Company’s assumptions. As of December 31, 2022 and 2021, the estimated fair value of the 2026 and 2031 Notes, which is based on Level 2 inputs, is $359 million and $541 million, and $401 million and $704 million, respectively. As of December 31, 2022 and 2021, the estimated fair value of the 2028 Notes, which is based on Level 2 inputs, is $884 million and $1,367 million, respectively, and were determined based on the closing trading price per $100 principal amount of the 2028 Notes as of the last day of trading for the period (see Note 17 “Loans payable and other financial liabilities” of these audited consolidated financial statements for further details). The rest of the loans payable and other financial liabilities approximate their fair value because the effective interest rates are not materially different from market interest rates.
The following table summarizes the estimated fair value level for the remaining financial assets and liabilities of the Company not measured at fair value as of December 31, 2022 and 2021:
Balances as of
December 31, 2022		Estimated fair value as of December 31, 2022Balances as of
December 31, 2021		Estimated fair value as of December 31, 2021
(In millions)
Assets
Time Deposits$439 $439 $16 $16 
Accounts receivables, net130 130 98 98 
Credit Card receivables and other means of payment, net2,946 2,946 1,839 1,839 
Loans receivable, net1,736 1,761 1,260 1,260 
Other assets273 273 457 457 
Total Assets$5,524 $5,549 $3,670 $3,670 
Liabilities
Accounts payable and accrued expenses$1,393 $1,393 $1,036 $1,036 
Funds payable to customers3,454 3,454 2,393 2,393 
Amounts payable due to credit and debit card transactions488 488 341 341 
Salaries and social security payable349 349 230 230 
Taxes payable414 414 291 291 
Loans payable and other financial liabilities (*)4,758 4,997 3,518 3,534 
Other liabilities186 186 117 117 
Total Liabilities$11,042 $11,281 $7,926 $7,942 
(*) Includes the fair value of the liability component of the 2028 Notes as of December 31, 2021 of $331 million.