Bitcoin has hit a new yearly high with PayPal adding fuel to its tank.
How times change.
It’s 2012. and I decided to pool our money together for the first event. We told them we wanted the best booth we could afford, but we needed to be next to the booth so we can show the world OUR financial system!
— Charlie Shrem (@CharlieShrem)
Yesterday PayPal announced it would enable customers to buy, sell and hold cryptocurrency through their PayPal accounts, and would make cryptocurrency available as a funding source for purchases from PayPal merchants.
Bitcoin prices, which were already leaning to the bullish around $12,200 prior to the announcement, went up another few notches as the news broke. By peaking at around $13,200 following the announcement, Bitcoin convincingly took out a new yearly high.
The PayPal move has been rumored since June, but now we have an official announcement. There are also a lot more details flowing now, including:
- PayPal will initially be supporting BTC, ETH, LTC and BCH only.
- PayPal will not allow crypto withdrawals or direct crypto transfers to other wallets.
- The service will initially be for US residents only and will become available “in the coming weeks”. Use of crypto as a funding source for purchases is set to commence early 2021.
- There will be no fees for buying or selling cryptocurrency on PayPal until 31 December.
- The service is coming to Venmo as well, scheduled for the first half of 2021.
- The crypto service is being provided through a partnership with Paxos.
- PayPal has received a new kind of provisional BitLicense from the NYDFS to provide this service in New York.
- PayPal is emphasizing educational content to inform users about cryptocurrency and normalize digital currencies.
- PayPal has over 300 million users including 26 million merchants. Although this is not new information, it does bear repeating.
More than pals
The initial offering is limited. There are no crypto withdrawals or transfers, the choice of available cryptocurrencies is questionable, it will start in the US only and there are uncertainties around whether popularizing cryptocurrency could cut into PayPal’s bread and butter of payments.
All of these have sparked debates on whether this is part of a larger plan or if PayPal is just mucking around with a new product in search of a little bit more revenue.
There are arguments for the former. As some , this is a complicated move for a company of PayPal’s size to pull off and it would have been easier for PayPal to pilot crypto purchases outside the US if the main objective was extra revenue from crypto sales. But instead it went for an exotic provisional BitLicense. Despite a somewhat lacking product this is still a big step.
“Make no mistake, this isn’t a pilot program. This isn’t a token gesture (no pun intended). PayPal just dove head first into the future of payments, and I expect that in the coming years they will aggressively be adding new features including deposits/withdrawals,” .
PayPal itself says as much.
“The shift to digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly,” said PayPal CEO and president Dan Schulman.
“Our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange. We are eager to work with central banks and regulators around the world to offer our support, and to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce.”
Just the right amount of bullish
All the coins named in PayPal’s line-up had a good day, while other cryptocurrencies such as RSR with rumored PayPal connections also spiked on the day. Litecoin in particular rose about 15% as the news circulated.
From one angle it’s an overconfident rise. There will likely be several weeks of waiting before PayPal actually starts selling crypto, during which prices might settle back as people realize that buying BCH and LTC to sell at a higher price later only works if prices go up.
At the same time, there are no clear guarantees the launch will move markets. It’s reasonable to assume PayPal has already accumulated a lot of the cryptocurrency it expects to need, so the initial market impact of PayPal customers buying crypto could be quite muted.
A more optimistic take is that prices will continue to rise across the board in the lead-up to PayPal’s release, paving the way nicely for a new wave of FOMO upon release. After all, PayPal’s cryptocurrency line-up will look much more attractive to a new audience if it’s performing well.
And once again, despite all the remaining uncertainties, it cannot be emphasized strongly enough that PayPal is very, very large. By most measures, PayPal is substantially bigger, more popular and more widely used than the assets it’s listing. If nothing else, this makes it a first for the cryptocurrency space and an event to keep an eye on.
Disclosure: The author owns cryptocurrencies including BTC and ETH at the time of writing
This information should not be interpreted as an endorsement of cryptocurrency or any specific provider,
service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and
involve significant risks – they are highly volatile and sensitive to secondary activity. Performance
is unpredictable and past performance is no guarantee of future performance. Consider your own
circumstances, and obtain your own advice, before relying on this information. You should also verify
the nature of any product or service (including its legal status and relevant regulatory requirements)
and consult the relevant Regulators’ websites before making any decision. Finder, or the author, may
have holdings in the cryptocurrencies discussed.
Radhika Apte reveals real reason why she got married
Radhika Apte needs no introduction to Kollywood fans after her appearance as Superstar Rajinikanth’s wife in ‘Kabali’ directed by Pa Ranjith. The intense actress impressed with her performance of a meek girl to a mother of a grown-up and especially her reunion scene with Rajini took the audience on an emotional ride.
Radhika is happily married to her British boyfriend Benedict Taylor who is a singer and she shuttles between Mumbai and London to balance her personal and professional life.
Radhika Apte in her most recent interaction with Vikranth Massey on social media from London has admitted that she does not believe in the institution of marriage. When asked why she got married the talented performer replied that it is easier for married people to get a British visa and that’s why she and her man opted for it in 2012.
Radhika is currently chilling with Taylor in their London home during the lockdown and will soon start filming her next English film ‘Noor Inayat Khan’ in which she plays a spy based on a true story.
Jacqueline Fernandez shares picture of her being in ‘happy place’
Actor Jacqueline Fernandez is working on a secret project where she found herself in a ‘happy place’. Taking it to Instagram on Sunday, the 35-year-old actor shared a picture dressed up like a traffic police officer as she is seen laughing her heart out.
“How was everyone’s Sunday?? Fun project coming up soon! #myhappyplace,” wrote Fernandez along with a picture where she is also seen holding a coffee mug. The ‘Kick’ actor also shared a few Instagram stories of her getting ready for the upcoming project.
Recently, the actor extended gratitude to her fans after the number of Instagram followers hit the 46 million mark.
Keep scrolling to read more news
Why an ‘active’ approach to risk modelling is key to navigating markets today
Whether investors are aiming for a cautious approach or a riskier investment profile with the potential for higher returns, Architas’ Blended Fund range is designed to match a range of investor risk appetites. And like many asset managers, Architas predominantly uses two approaches to define asset allocation within the five risk bands used in the Blended Range – strategic and tactical.
Whilst risk model provider EValue’s quantitative approach to asset allocation takes into account the long-term performance of different asset classes and the likely future performance given current valuations, along with long-term measures of volatility and correlations with other asset classes. Yet as with most systems of its kinds, EValue focuses on the long term; it is unable to analyse short-term market movements and fluctuations. So whilst it would have seen that in Q1 2020 markets fell by a record percentage before rebounding, it will not be able to factor in the cost of the coronavirus and lockdown and its impact on markets. Similarly, it is not able to consider ongoing Brexit woes, geo-political trade wars or the outcome of the US election in 2020.
Click here for the full article and to access more about the flexibility of the Architas Blended Range by clicking on the box below.
Read Guide Here