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Paypal Bought 70% of All Newly Mined Bitcoin Last Month as Demand Rockets
Paypal bought up to 70% of all the newly mined bitcoin since the payments giant started offering cryptocurrency services four weeks ago.
Now that’s according to estimates by hedge fund manager Pantera Capital, as revealed in its latest monthly blockchain letter. Together with Square’s Cash App, the two companies are buying more than 100% of all newly issued virgin bitcoin( BTC), it says.
The letter said demand for Paypal’s crypto service, which runs on Paxos fiat-to-crypto exchange, Itbit, had hit the roof. The exchange “was doing a fairly constant amount of trading volume… [but] when Paypal went live, volume started exploding,” it observed, adding:
The increase in Itbit volume implies that within four weeks of going live, Paypal is already buying almost 70% of the new supply of bitcoins.
Paypal announced in late October that its customers – running in excess of 300 million active users – will now be able to buy, hold and sell bitcoin and other digital assets using their Paypal accounts.
The decision also meant users could use their coins to buy things from the 26 million merchants that accept Paypal, it said. Paypal rolled out the crypto service to U.S. customers early this month, with the rest of the world set to be integrated later.
Bitcoin prices rose alongside the Paypal news, breaching $12,000 at the time the service was announced, and has maintained the bullish momentum ever since, hitting a three-year high of $18,997 on Nov. 20.
Pantera Capital noted that the Paypal crypto service is “already having a huge impact”. As shown in the graph above, it predicted that if the “growth persists, Paypal alone would be buying more than all of the newly-issued bitcoin within weeks.”
The letter also argues that bitcoin’s current rally is much more “sustainable” than 2017’s because of rising institutional demand from entities such as Paypal, Cash App, and Robinhood, which make buying bitcoin easy.
“Previously the friction to buy bitcoin was pretty onerous: take a selfie with your passport, wait days to a week to get activated, daily limits,” said the letter.
Data shows bitcoin’s current rally has in large part being driven by institutional buyers. According to the bitcointreasuries.org website, which curates bitcoin investments by publicly traded companies, about 21 firms, including Microstrategy Inc and Galaxy Digital Holdings, hold a combined $14.42 billion of BTC in reserve. That’s 832,351 BTC or over 4% of bitcoin’s circulating supply.
A number of these purchases have happened in the last few months, pushing the price of bitcoin higher. Pantera Capital says the shortage of bitcoin resulting from high corporate demand means that the likes of Cash App, which recently reported a record $1.6 billion bitcoin revenue, will have to pay more for each coin.
“When other, larger financial institutions follow their (Cash App) lead, the supply scarcity will become even more imbalanced. The only way supply and demand equilibrates is at a higher price,” it explained.
What do you think and Paypal scooping 70% of newly minted bitcoin? Let us know in the comments section below.
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Image Credits: Shutterstock, Pixabay, Wiki Commons, Chart by Pantera Capital,
Market Update: Crypto Asset Prices Spike Massively, Speculators Claim 'Altcoin Season' Is Here
A number of crypto-asset markets saw significant gains on Saturday, as a myriad of digital assets spiked between 4-40% in value during the last 24 hours. The entire crypto market capitalization had risen above $540 billion, as top-ten coin values from the likes of bitcoin cash, cardano and XRPjumped massively in value.
On Saturday, November 21, 2020, the overall market valuation of all 7,000+ crypto-assets in existence is around $520 to $540 billion. At the time of publication, there’s also around $20 to $32 billion in global trade volume as well.
The top digital currency in terms of market cap, bitcoin (BTC) jumped over 1% today and coasted along at a daily high at $18,840 per unit. BTC’s modest gains today is nothing compared to a number of coins that have jumped significantly in value.
The altcoin spark has caused a number of speculators to believe that a highly anticipated ‘altcoin season’ is looming on the horizon. For instance, the third-largest market cap today is held by XRP and the asset saw a 33%+ spike on Saturday driving the price up to $0.42 per unit high.
The second-largest crypto by market valuation, ethereum (ETH) traded for $540 per ether at its high and is still up over 4% today. Chainlink (LINK) jumped over 8% and LINK now trades at over $15 per coin. Litecoin (LTC) has seen a phenomenal week gaining 38% during the last seven days. LTC is up over 7% on Saturday afternoon (EST) and had traded at a daily high at $87.46 per coin.
Bitcoin Cash (BCH) is up 14% this week and most of that stems from the 18%+ jump BCH experienced this Saturday. BCH is was swapping for $303 per coin, as the crypto asset crossed over the psychological $300 resistance zone. Currently, BCH is trading between $296 and $301 at the time of publication.
Polkadot (DOT) bounced 6.9% and the crypto asset BNB gained 5% on Saturday. The tenth position in terms of market cap, cardano (ADA), leaped over 17.6% this weekend and was trading at a $0.128 per unit daily high.
The biggest gainer on Saturday is crypto.com’s MCO coin, which gathered 109% in value and the biggest loser is indorse token (IND) which lost 59% today.
According to a number of posts on the Reddit forum r/cryptocurrency and trending conversations on Twitter, numerous individuals believe “altcoin season is back,” because of Saturday’s altcoin market performances. Other notable gainers today include; EOS (15%), XLM (20%), VET (19%), IOTA (19%), DOGE (18%), and ALGO (14%).
“November 2020: Official Altcoin Season Starts. Let the games begin,” tweetedthe Twitter account ‘Cryptobud.’
What do you think about the altcoin performances this weekend? Let us know what you think about this subject in the comments section below.
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ada, Bitcoin, bitcoin cash, BitStamp, BTC, crypto economy, Crypto Prices, Digital Assets, Ethereum, LiNK, Market Cap, Market Update, Market Valuation, Markets, markets and prices, Prices, Ripple, RSI, XRP
Image Credits: Shutterstock, Pixabay, Wiki Commons |
