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Fair Value Measurements
 6 Months Ended
Jun. 30, 2022
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Certain assets and liabilities are carried at fair value under U.S. GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value and nonrecurring fair value measurements are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:
 
•Level 1 — Quoted prices in active markets for identical assets or liabilities.
•Level 2 — Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

•Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value as of June 30, 2022 and December 31, 2021 based on the three-tier fair value hierarchy:

June 30, 2022
Level 1Level 2Level 3Total
Assets
Cash equivalents:
Money market funds$200,537 
(1)
$— $— $200,537 
Other current assets:
Digital assets held for users— 17,283 
(2)
— 17,283 
Other non-current assets:
Derivative instruments— — 46,633 
(5)
46,633 
Equity securities18,675 
(3)
13,533 
(4)
— 32,208 
Total$219,212 $30,816 $46,633 $296,661 
Liabilities
Other current liabilities:
Digital assets held for users$— $17,283 
(2)
$— $17,283 
Warrant liabilities — 13,081 
(6)
— 13,081 
Total$— $30,364 $— $30,364 

December 31, 2021
Level 1Level 2Level 3Total
Assets
Cash equivalents:
Money market funds$550,169 
(1)
$— $— $550,169 
Other non-current assets:
Derivative instruments— — 3,850 
(5)
3,850 
Equity securities27,200 
(3)
— — 27,200 
Total$577,369 $— $3,850 $581,219 
Liabilities
Warrant liabilities $— $26,911 
(6)
$— $26,911 
Total$— $26,911 $— $26,911 

(1)Represents the Company’s money market funds, which are classified as Level 1 because the Company measures these assets to fair value using quoted market prices.
(2)Represents the asset and liability balance for the digital assets held by the Company for its users, which are classified as Level 2 because the Company measures these digital assets to fair value using observable inputs for similar transactions.
(3)Represents the Company’s marketable equity securities, which are classified as Level 1 because the Company measures these assets to fair value using quoted market prices.
(4)Represents the Company’s non-marketable equity securities, which are classified as Level 2 because the Company measures these assets to fair value using observable inputs for similar investments of the same issuer. The Company has elected the remeasurement alternative for these assets.
(5)Represents the Company’s derivative instruments held in other public and privately held entities. The Company measures these derivative instruments to fair value using option pricing models and, accordingly, classifies these assets as Level 3. During the six months ended June 30, 2022, there were not a significant amount of new derivative instruments purchased by or issued to the Company. The table below includes a range and an average weighted by relative fair value of the significant unobservable inputs used to measure these Level 3 derivative instruments to fair value. A change in these significant unobservable inputs might result in a significantly higher or lower fair value measurement at the reporting date.
June 30, 2022December 31, 2021
Significant Unobservable InputRange (Weighted Average)
Underlying stock price
$7.47 - $39.22 ($34.35)
$10.88 
Volatility
70.0% - 75.0% (73.5%)
60.0 %
Risk-free rate
1.3% - 1.6% (1.4%)
0.3 %
(6)The Company measures its Private Warrants and the GNOG Private Warrants to fair value using a binomial lattice model with the significant assumptions being observable inputs and, accordingly, classifies these liabilities as Level 2.
During the three and six months ended June 30, 2022, the Company recorded $5.6 million of unrealized loss and $31.8 million of unrealized gains, respectively, primarily all of which resulted from those financial assets categorized as Level 3. Those unrealized gains are included within other income, net in the Company’s condensed consolidated statements of operations. During the three and six months ended June 30, 2021, no such gains or losses were recorded.