If you haven’t heard the news yet, PayPal announced on Twitter on October 22, 2020 that they will be adding support to buy and sell cryptocurrencies via their app. This is HUGE news because PayPal currently has about 346 million active PayPal accounts. That means everyone that is involved in that ecosystem will be exposed to Bitcoin and other Altcoins. While PayPal was not the first payment app to add cryptocurrency support. (Square’s Cash App has had cryptocurrency support for a while.) PayPal has a much larger user base then competing payment platforms.
This is a huge plus for Bitcoin and other cryptocurrencies. This is mainstream adoption! Think about it, even your parents or your grandparents probably know what PayPal is or have tried it before. Think about how many people use PayPal. Everyone that buys or sells items on eBay are most likely using PayPal, everyone that shops online has probably used PayPal before or has an account. And the more people that are exposed to Bitcoin and other cryptocurrencies, the higher chance that more people will invest in it. And there are probably a ton of people who maybe sold an item on eBay and don’t want to wait the time for their money to transfer to their bank account, they might opt in to buying cryptocurrencies instead. PayPal has greatly increased exposure to the cryptocurrency market in general.
One disappointment however is it appears PayPal will restrict users from withdrawing their cryptocurrencies off of PayPal’s app. Everyone knows that if you do not own your private key then you do not own the Bitcoin. While this is generally considered a bad thing among most cryptocurrency investors, it should be noted that PayPal’s target audience is most likely very different from the average cryptocurrency investor. I would estimate that most of PayPal’s users are buying cryptocurrency for the first time and do not have the understanding level of blockchain technology required to be responsible for their own private keys. So overall I would say it is fine that PayPal remains the custodian for the cryptocurrencies on their platform. After all many companies already do the same thing such as the ever popular Robinhood. After these users are exposed to cryptocurrency, we can educate them on the technology and the best practices for using it.
Overall, I would say institutions offering support for cryptocurrencies is bullish in general. It makes it go from a niche market to a more main stream one. This is a long-term good thing for the entire market. The more people that are aware, the higher the price can become. Imagine if 20% of the world owned Bitcoin? Due to its scarcity, it would naturally force price upwards. Let me know in the comments below what are your thoughts on PayPal adding support for cryptocurrencies? Do you think it is a bullish sign for Bitcoin and other Altcoins?
