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DERIVATIVES (Tables) | 9 Months Ended
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Sep. 30, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Description of derivatives and related hedge accounting designation | The following outlines the Company’s derivatives and the related hedge accounting designation, as applicable.
Type of Derivative |  | Description of Derivative |  | Location of Host Contract and Derivative on Balance Sheets
Crypto asset borrowings(1) |  | The Company borrowed crypto assets that resulted in the obligation to deliver a fixed amount of crypto assets in the future. |  | Crypto asset borrowings
Accounts receivable denominated in crypto assets |  | The Company provided services for which, under the contract, the customer pays in crypto assets. The amount of crypto assets are fixed at the time of invoicing. The right to receive fixed amounts of crypto assets consists of a receivable host contract and an embedded forward contract to purchase crypto assets. |  | Accounts and loans receivable, net of allowance
Other payables denominated in crypto assets |  | The Company entered into arrangements that result in the obligation to deliver a fixed amount of crypto assets in the future. |  | Accrued expenses and other current liabilities
Crypto asset futures(1) |  | The Company entered into short positions on futures contracts to minimize the exposure on the change in the fair value price of crypto assets held. |  | Accounts and loans receivable, net of allowance
Foreign currency forward contracts |  | The Company entered into foreign currency forward contracts, with maturities of 12 months or less, to offset the foreign currency exchange risk of its assets and liabilities denominated in foreign currencies. These contracts are not designated as hedging instruments and reduce, but do not entirely eliminate, the impact of foreign currency exchange rate movements on the Company’s assets and liabilities. |  | Prepaid expenses and other current assets/ Accrued expenses and other current liabilities
__________________ (1) For risk management purposes, the Company applies hedge accounting using these derivative instruments in qualifying fair value hedges to primarily hedge the fair value exposure of crypto asset prices.
Schedule of the notional amount of derivative contracts outstanding | The following table summarizes the notional amounts of derivative instruments outstanding, measured in U.S. dollar equivalents (in thousands):
| September 30, |  | December 31,
| 2022 |  | 2021
Designated as hedging instrument |  |  |
Crypto asset borrowings with embedded derivatives | $ | 210,075 |  |  | $ | 669,445 |
Crypto asset futures(1) | 771 |  |  | — |
Not designated as hedging instrument |  |  |
Accounts receivable denominated in crypto assets | 16,748 |  |  | 17,415 |
Other payables denominated in crypto assets | 13,627 |  |  | — |
Crypto asset futures(1) | 994 |  |  | — |
Foreign currency forward contracts(1) | 1,100,000 |  |  | — |
__________________ (1) Derivative transactions are measured in terms of the notional amount; however, this amount is not recorded on the condensed consolidated balance sheets and is not, when viewed in isolation, a meaningful measure of the risk profile of the derivative instruments. The notional amount is generally not exchanged, but is used only as the underlying basis on which the value of exchange payments or settlement under these contracts are determined. The following tables summarize information on derivative assets and liabilities that are reflected in the Compan y’s condensed consolidated balance sheets, by accounting designation (in thousands):
| Gross Derivative Assets |  |  |  | Gross Derivative Liabilities |  |
September 30, 2022 | Not Designated as Hedges |  | Designated as Hedges |  | Total Derivative Assets |  |  |  | Not Designated as Hedges |  | Designated as Hedges |  | Total Derivative Liabilities |  |
Crypto asset borrowings with embedded derivatives(1) | $ | — |  |  | $ | 3,580 |  |  | $ | 3,580 |  |  |  |  | $ | — |  |  | $ | 3,183 |  |  | $ | 3,183 |  |  |
Accounts receivable denominated in crypto assets | — |  |  | — |  |  | — |  |  |  |  | 5,791 |  |  | — |  |  | 5,791 |  |  |
Other payables denominated in crypto assets | 4,261 |  |  | — |  |  | 4,261 |  |  |  |  | 3,705 |  |  | — |  |  | 3,705 |  |  |
Foreign currency forward contracts | 22,935 |  |  | — |  |  | 22,935 |  |  |  |  | — |  |  | — |  |  | — |  |  |
Total fair value of derivative assets and liabilities | $ | 27,196 |  |  | $ | 3,580 |  |  | $ | 30,776 |  |  |  |  | $ | 9,496 |  |  | $ | 3,183 |  |  | $ | 12,679 |  |  |
__________________ (1) During the nine months ended September 30, 2022, the fee on these borrowings ranged from 0.0% to 7.5%. During the nine months ended September 30, 2021, the fee on these borrowings ranged from 0.0% to 3.0%. During the three and nine months ended September 30, 2022, the Company incurred $0.9 million and $3.9 million, respectively, of borrowing fees in crypto assets. During the three and nine months ended September 30, 2021, the Company incurred $2.3 million and $9.5 million, respectively, of borrowing fees in crypto assets. Borrowing fees are included in other operating expense, net in the condensed consolidated statements of operations.
| Gross Derivative Assets |  |  |  | Gross Derivative Liabilities |  |
December 31, 2021 | Not Designated as Hedges |  | Designated as Hedges |  | Total Derivative Assets |  |  |  | Not Designated as Hedges |  | Designated as Hedges |  | Total Derivative Liabilities |  |
Crypto asset borrowings with embedded derivatives | $ | — |  |  | $ | 336,396 |  |  | $ | 336,396 |  |  |  |  | $ | — |  |  | $ | 93,616 |  |  | $ | 93,616 |  |  |
Accounts receivable denominated in crypto assets | 9,033 |  |  | — |  |  | 9,033 |  |  |  |  | — |  |  | — |  |  | — |  |  |
Total fair value of derivative assets and liabilities | $ | 9,033 |  |  | $ | 336,396 |  |  | $ | 345,429 |  |  |  |  | $ | — |  |  | $ | 93,616 |  |  | $ | 93,616 |  |  |
The following amounts were recorded in the condensed consolidated balance sheets related to certain cumulative fair value hedge basis adjustments that are expected to reverse through the condensed consolidated statements of operations in future periods as an adjustment to other operating expense, net (in thousands):
|  |  | Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of Hedged Items
September 30, 2022 | Carrying Amount of the Hedged Items |  | Active Hedging Relationships |  | Discontinued Hedging Relationships |  | Total
Crypto assets held | $ | 209,972 |  |  | $ | (1,025) |  |  | $ | 448 |  |  | $ | (577) |
|  |  | Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of Hedged Items
December 31, 2021 | Carrying Amount of the Hedged Items |  | Active Hedging Relationships |  | Discontinued Hedging Relationships |  | Total
Crypto assets held | $ | 421,685 |  |  | $ | (240,771) |  |  | $ | — |  |  | $ | (240,771) |
Offsetting assets | The following table provides the collateral posted (in thousands):
| September 30, |  | December 31,
| 2022 |  | 2021
Cash collateral posted(1) | $ | 145,000 |  |  | $ | — |
__________________ (1) Right to reclaim cash collateral related to derivatives recognized in prepaid expenses and other current assets in the condensed consolidated balance sheets.
Offsetting liabilities | The following table provides the collateral posted (in thousands):
| September 30, |  | December 31,
| 2022 |  | 2021
Cash collateral posted(1) | $ | 145,000 |  |  | $ | — |
__________________ (1) Right to reclaim cash collateral related to derivatives recognized in prepaid expenses and other current assets in the condensed consolidated balance sheets.
Schedule of gains (losses) recorded in income | Gains (losses) on derivative instruments recognized in the Company’s condensed consolidated statements of operations were as follows (in thousands):
| Three Months Ended September 30, 2022 |  | Three Months Ended September 30, 2021
| Derivatives |  | Hedged Items |  | Income Statement Impact |  | Derivatives |  | Hedged Items |  | Income Statement Impact
Designated as fair value hedging instruments |  |  |  |  |  |  |  |  |  |  |
Crypto asset borrowings with embedded derivatives(1) | $ | (211,110) |  |  | $ | 207,112 |  |  | $ | (3,998) |  |  | $ | (75,999) |  |  | $ | 75,143 |  |  | $ | (856) |
Crypto asset futures(1) | 225 |  |  | (77) |  |  | 148 |  |  | — |  |  | — |  |  | — |
Not designated as hedging instruments |  |  |  |  |  |  |  |  |  |  |
Accounts receivable denominated in crypto assets(1) | (4,213) |  |  | — |  |  | (4,213) |  |  | — |  |  | — |  |  | — |
Other payables denominated in crypto assets(1) | (2,367) |  |  | — |  |  | (2,367) |  |  | — |  |  | — |  |  | — |
Crypto asset futures(1) | (566) |  |  | — |  |  | (566) |  |  | — |  |  | — |  |  | — |
Foreign currency forward contracts(2) | 22,935 |  |  | — |  |  | 22,935 |  |  | — |  |  | — |  |  | — |
Total | $ | (195,096) |  |  | $ | 207,035 |  |  | $ | 11,939 |  |  | $ | (75,999) |  |  | $ | 75,143 |  |  | $ | (856) |
| Nine Months Ended September 30, 2022 |  | Nine Months Ended September 30, 2021
| Derivatives |  | Hedged Items |  | Income Statement Impact |  | Derivatives |  | Hedged Items |  | Income Statement Impact
Designated as fair value hedging instruments |  |  |  |  |  |  |  |  |  |  |
Crypto asset borrowings with embedded derivatives(1) | $ | 148,959 |  |  | $ | (154,228) |  |  | $ | (5,269) |  |  | $ | 105,558 |  |  | $ | (93,973) |  |  | $ | 11,585 |
Crypto asset futures(1) | 13,237 |  |  | (12,339) |  |  | 898 |  |  | — |  |  | — |  |  | — |
Not designated as hedging instruments |  |  |  |  |  |  |  |  |  |  |
Crypto asset borrowings with embedded derivatives(1) | 6,626 |  |  | — |  |  | 6,626 |  |  | — |  |  | — |  |  | — |
Accounts receivable denominated in crypto assets(1) | (14,476) |  |  | — |  |  | (14,476) |  |  | — |  |  | — |  |  | — |
Other payables denominated in crypto assets(1) | 143 |  |  | — |  |  | 143 |  |  | — |  |  | — |  |  | — |
Crypto asset futures(1) | (1,077) |  |  | — |  |  | (1,077) |  |  | — |  |  | — |  |  | — |
Foreign currency forward contracts(2) | 22,935 |  |  | — |  |  | 22,935 |  |  | — |  |  | — |  |  | — |
Total | $ | 176,347 |  |  | $ | (166,567) |  |  | $ | 9,780 |  |  | $ | 105,558 |  |  | $ | (93,973) |  |  | $ | 11,585 |
__________________ (1)Changes in fair value are recognized in other operating expense, net in the condensed consolidated statements of operations. (2)Changes in fair value are recognized in other expense, net, which partially offset gains and losses due to the remeasurement of certain foreign currency denominated assets and liabilities which are also recognized in other expense, net in the condensed consolidated statements of operations.

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