When rumors of PayPal Bitcoin adoption first surfaced, the COO of OKCoin, Jason Lau, was quick to distance himself from fueling the legitimacy of such rumors. It was easy to see why. Mainstream payment giant PayPal foray into the crypto world was such big news that talking about the situation felt like a jinx.
In this writeup, the focus will be on exploring the effect of the PayPal adoption of Bitcoin and the potential surge in Bitcoin’s price as a ripple effect.
As world-renowned artiste and producer Akon puts it in his Milken Global Conference speech, “Bitcoin has the potential to change the world from a monetary and transactional point of view, not just for Africa, but across the world.”
“When a long-established company like PayPal, with its 325 million users, engages the crypto space, the impact of such entry is sure to have a positive impact and promote cryptocurrency to a wider audience.” Jason Lau adds.
The first big hint dropped on June 22 when PayPal added job listings on the web looking for blockchain and crypto-related engineers. In line with this move, popular Bitcoin website CoinTelegraph confirmed that PayPal would be releasing the new feature to 26 million users globally on its debut.
Since PayPal’s crypto listing is now public, details have started pouring in on more information such as customer price exposure, full on-chain ownership, and the option to send to external wallets.
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What Does PayPal Cryptocurrency Adoption Mean For Bitcoin?
The co-founder of PayPal, Peter Thiel, had this to say about Bitcoin, “PayPal had goals of creating a new currency. Unfortunately, we failed at that and only built a new payment system. Bitcoin has succeeded at that, and we feel the payment system is somewhat lacking. We consider it hard to use, which is one of the biggest challenges on the Bitcoin side.”
While it is difficult to predict with certainty – Bitcoin just passed the $16,000 mark from $13,000 since the PayPal announcement – what the effect of PayPal entry will cause, readers can take insight from Two And A Half Men TV show actor Ashton Kutcher at TechCrunch Disrupt New York Conference:
“Since we don’t have to worry about corporations and exorbitant fees, the infrastructure Bitcoin is built on could be used in different industries for mass good as it promotes anonymity while still civilly monitoring transactions.” It is one of the significant selling points for Bitcoin.
Our thoughts on the effect of PayPal’s decision is documented below.
Current Crypto Traders Now Face A Colossal Competitor
Previously you had to engage a crypto broker for entry to the crypto sphere. These online brokers allowed you to create user accounts, deposit fiat m, and directly exchange PayPal payment to a cryptocurrency of your choosing.
For new users, the need for a crypto broker has been eliminated. Why go through the rigors of a KYC procedure when you can process your Bitcoin transactions through PayPal directly! That is a value proposition that is tough to beat.
Simply put, PayPal offers a payment system with a built-in cryptocurrency feature. You could argue that other crypto brokers provide a more comprehensive array of cryptocurrencies to deal with, but BTC currently holds 79% of the crypto market share at the time of writing.
- Influx Of New Users Into The Cryptosphere
PayPal will most likely aid the entry of millions of new users into the world of cryptocurrency. With a current customer base of 184 million, it is feasible to expect at least 3 to 10 million of these users to adopt the purchase and sale of “that thing they call Bitcoin.”
This projection is based on the fact that convenience Reigns supreme, and right now, PayPal offers an easy and cheap way to buy Bitcoin.
As more users hop on the Bitcoin wave, it is unavoidable that its value will increase. The more people use Bitcoin, the higher its value.
- PayPal Adoption Proves Confidence In The Future Of Digital Currency
Digital assets are the future. There is no doubt about that. As PayPal’s press release confirms, notable bankers from Europe have come out to support the creation and mainstream use of a digital Euro. President Christine Lagarde of The European Central Bank has reportedly even trademarked the term “digital Euro,” which shows that traditional banks believe the digital Euro can compete with existing cryptocurrencies.
The decision by PayPal to provide customers with the option to buy and sell Bitcoin (as well as ETH, BCH, and LTC) as a means of funding payment to PayPal merchants has been deservedly dubbed “the biggest news in cryptocurrency since the turn of the decade.”
Well, it has a close competitor in the hype around decentralized finance (DeFi) on the front pages.
It is fair to speculate that PayPal’s decision will introduce millions of users to the world of cryptocurrency, shake up the existing crypto-broker structure, promote mainstream use of cryptocurrency, and inevitably lead to an increase in price once Bitcoin starts getting publicly accepted (more).
While we cannot foresee where all these moves on the crypto chessboard will end up, expect many companies to follow suit – Square (the parent company of Twitter) recently purchased $50m worth of Bitcoin.
This is excellent news for the crypto space. As we mentioned earlier in the article, this move by PayPal is enough to trigger a crypto spring. Bitcoin has seen a $3000 raise in value since PayPal’s announcement.
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