- PayPal buys 70% of Bitcoin supply mined to meet demand in its crypto service which includes ETH, LTC, BCH.
- Companies that have invested in Bitcoin have an estimated $15 billion or 842,229 BTC accumulated.
Pantera Capital has published a report on the impact that the entry of big players into the crypto market has had. There, the investment firm claims that Square and PayPal have increased the buying pressure on Bitcoin. Therefore, Bitcoin’s price has received a positive boost.
At the time of publication, BTC traded at $18,532 with a 2.79% gain in the last 24 hours. In the weekly and monthly charts, the earnings are 13.98% and 55.68% respectively. In terms of market capitalization, Bitcoin has reached a new all-time high with $350 billion surpassing, as celebrated in the crypto community, Mastercard.
— Cryptowatch (@cryptowat_ch) November 20, 2020
The current rally, says Pantera Capital, shows signs of being more “sustainable” than in 2017 by relying on institutional demand. Therefore, it could go beyond a new all-time high in the price of BTC. The investment firm has determined that together PayPal with 70% and Square with 40%, buys more than the supply produced by BTC. They do this by increasing their offer for each BTC.
Due to the requirements of the Bitlicense that PayPal has acquired from the state of New York, the company must maintain “real Bitcoin” at a 1-to-1 parity for each unit purchased by its users. As indicated by Pantera Capital, PayPal’s users are estimated at 300 million. In comparison, Bitcoin has about 100 million users. The report stated the following when showing the image below:
The dashed horizontal line in the graphic represents the total supply of newly-issued bitcoins plus the original itBit volume. If their growth persists, PayPal alone would be buying more than all of the newly-issued bitcoin within weeks.
Currently, only eligible PayPal customers in the United States are eligible to use the crypto service that includes Ethereum, Litecoin and Bitcoin Cash. However, the company plans to expand its service next year for international customers. This could continue to increase buying pressure from BTC. Pantera Capital makes the following forecast:
That is THE story in Bitcoin right now. When other, larger financial institutions follow their lead, the supply scarcity will become even more imbalanced. The only way supply and demand equilibrates is at a higher price.
Bitcoin becomes scarcer as companies accumulate
The data speaks for itself; Bitcoin’s rally has been driven by companies that have entered a state of “frenzy” to acquire BTC. Bitcointresuries data shared by investor Clark Moody indicates that currently the companies that have bought Bitcoin, such as Galaxy Digital Holdings and MicroStrategy, have an estimated $15 billion accumulated. This represents 842,229 BTC or 4.54% of the total BTC supply.
Three Arrows Capital’s CEO, Su Zhu, is relying on data from the BTC-based financial derivatives platform, Deribit, to set a new target price for the cryptocurrency at $36,000. Zhu said open interest in the platform is at an all-time high, as shown by Skew’s data in the image below.
Der Beitrag PayPal users are buying huge amounts of Bitcoin data shows erschien zuerst auf Crypto News Flash.