PayPal and Square Buy Every New Mined Bitcoin?
Here is a new version of what is causing the Bitcoin rally lately. Pantera Capital believes that PayPal and Square are buying every new mined Bitcoin to bring scarcity in the markets, causing a BTC rally.
An investment fund Pantera Capital said in their recent report that PayPal’s adoption of Bitcoin made a significant impact on its bullish price.
PayPal vs Bitcoin 3:1
Let’s look deeper at how PayPal adapts its philosophy to cryptocurrencies, making digital assets super simple in use. Pantera Capital says that the easy way with which PayPal gives its crypto services has made a “huge impact” on the public adoption of BTC and other virtual currencies:
“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. Three hundred million people just got instant access to Bitcoin, Ethereum, and other cryptocurrencies. BOOM! the results are already apparent.”
PayPal's customer base changed the whole thing. According to Pantera Capital`s data, 300 million accounts on PayPal are three times more than the number of BTC addresses for today.
Many consider the 2020 Bitcoin bullish rally to be more stable than that of 2017. That’s why big companies like PayPal or Square`s Cash App are so important for the market.
Pantera Capital believes PayPal and Cash App are now buying every single new mined Bitcoin, causing a scarcity in the market, ultimately driving the BTC price on.
If Pantera Capital evaluations are real, this will mean that with time there will be less and less Bitcoin accessible for trading:
“When PayPal went life, volume started exploding. 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 and Cash App are already buying more than 100% of all newly-issued bitcoins.”
PayPay and Cash App buy 110% of all newly mined Bitcoins
Pantera Capital said in its previous report that Cash App was buying about 40% of all fresh issued Bitcoins that miners put into circulation:
“Square’s Cash App got out to an early lead in this space. In Q1 2020, Square purchased $306mm in bitcoin, up 72% from Q4 2019. Square purchased almost a quarter of the total amount of bitcoin created in that quarter. (A year ago, Square’s Cash App was reportedly buying less than 10%.)”
At the same moment, PayPal buys 70% of all newly mined Bitcoins. If we calculate the numbers, we have both companies getting 110% of all the coins, making a shortage of 10% in the market.
And despite all the criticism, PayPal is getting from bitcoin investors, analysts, and other enthusiasts, the company is still making them 62% richer due to the bullish rally.
