The introduction of PayPal into the cryptocurrency industry may have a drastic effect on the price of Bitcoin. Crypto investment company Pantera Capital claims in a recently released report that a Bitcoin shortage is at the core of the latest price spike and that PayPal is scooping up the majority of newly minted BTC. The latest crypto service from PayPal is “already having a huge impact,” Pantera says, adding that about 70 percent of all the new BTC in circulation is snatched up by the payment merchant.
According to Pantera, the data shows that all newly released Bitcoins are bought through PayPal and Cash App together. As cointelegraph.com reported, Bitcoin’s monetary policy is programmed to be deflationary over time. With widescale adoption, that leads to higher purchasing power and supply scarcity. Pantera claims it is the latter that is contributing to BTC’s parabolic surge.
Pantera claims buying Bitcoin today is much simpler than it was during the previous bull market in 2017. In addition to PayPal, retail onramps into Bitcoin and other digital currencies now include Cash App and Robinhood. Wider acceptance means that higher price levels are more likely to be maintained by the digital currency. While Bitcoin remains incredibly unpredictable, until catapulting higher over the past two months, it carved out an unusually long span of stability.