INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Income before Income Tax, Domestic and Foreign

The components of income (loss) before income taxes were as follows:

	Year Ended December 31,
(in millions)	2021		2022		2023
Domestic	$	(3,687)	$	(1,028)	$	(534)
Foreign	2		1		1
Income (loss) before income taxes	$	(3,685)	$	(1,027)	$	(533)

Schedule of Income Tax Provision (Benefit)

The components of the provision for (benefit from) income taxes were as follows:

	Year Ended December 31,
(in millions)	2021		2022		2023
Current:
Federal	$	—	$	—	$	5
State	5		1		3
Foreign	—		—		—
Total current tax expense (benefit)	5		1		8
Deferred:
Federal	(1)		—		—
State	(2)		—		—
Foreign	—		—		—
Total deferred tax expense (benefit)	(3)		—		—
Total provision for (benefit from) income taxes	$	2	$	1	$	8

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of statutory federal income tax rate and our effective income tax rate was as follows (in percentages):

	Year Ended December 31,
	2021		2022		2023
Federal tax benefit at statutory rate	21.0	%	21.0	%	21.0	%
State tax benefit, net of federal benefit	3.6		1.8		(1.9)
Foreign rate differential	—		—		—
Share-based compensation	(0.5)		(12.3)		(29.7)
Research and development credits	1.3		3.6		5.6
Non-deductible change in convertible notes and warrant	(0.3)		—		—
Non-deductible regulatory settlements	(11.7)		(0.3)		(4.6)
Permanent differences	—		(0.1)		(0.2)
Other	—		0.1		0.4
Change in valuation allowance	(13.5)		(13.9)		8.0
Total provision for (benefit from) income taxes	(0.1)	%	(0.1)	%	(1.4)	%

Schedule of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities consisted of the following:

	Year Ended December 31,
(in millions)	2022		2023
Deferred tax assets:
User cryptocurrencies safeguarding obligation	$	2,167	$	3,660
Net operating loss carryforwards	266		176
Tax credit carryforwards	134		161
Research and Experimentation expenditure amortization	83		151
Share-based compensation	85		43
Accruals and other liabilities	21		29
Lease liabilities	38		27
Other	15		19
Total deferred tax assets	$	2,809	$	4,266
Deferred tax liabilities:
Asset related to user cryptocurrencies safeguarding obligation	$	(2,167)	$	(3,660)
Right of use assets	(24)		(17)
Depreciation and amortization	(10)		(14)
Total deferred tax liabilities	(2,201)		(3,691)
Valuation Allowance	(607)		(574)
Net deferred tax assets	$	1	$	1

Summary of Valuation Allowance

The reconciliation of the beginning and ending amount of the deferred tax asset valuation allowance was as follows:

	Year ended December 31,
(in millions)	2021		2022		2023
Balance at beginning of period	$	27	$	495	$	607
Charged/(credited) to net income	471		112		(34)
Charges utilized/(write-offs)	(3)		—		1
Balance at end of period	$	495	$	607	$	574

Schedule of Unrecognized Tax Benefits Roll Forward

The reconciliation of the beginning and ending amount of unrecognized tax benefits were as follows (in millions):

	Year Ended December 31,
	2022		2023
Unrecognized benefit - beginning of period	$	46	$	58
Gross increases - current year tax positions	16		16
Gross increases - prior year tax positions	—		—
Gross decrease - prior year tax positions	(4)		—
Unrecognized benefit - end of period	$	58	$	74