ADVERTISEMENT
Advertise with BNC

Bitcoin price surges on PayPal news

Bitcoin price surges to a new 2020 high as a series of bullish news events push crypto markets up

After grinding slowly up to the $12,000 level throughout October, Bitcoin surged from $12,000 to briefly touch $13,200. The sharp move upwards took place in just under 24 hours and has ignited a new mood of bullishness across the crypto space.

One trigger for the move was an official announcement by PayPal that it will begin allowing U.S. users to buy, sell, and store crypto assets. The first assets available on PayPal are Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.

In the announcement, the company says “mainstream adoption of crypto assets has been hindered by their limited utility as an instrument of exchange due to volatility, cost, and speed to transact. However, the promise of advanced technological platforms offers the possibility of mainstreaming digital currencies. According to a survey by the Bank for International Settlements, one in 10 central banks – representing approximately one-fifth of the world’s population – expects to issue their own digital currencies within the next three years.”

PayPal CEO Dan Schulman believes the shift to digital currencies is inevitable. He says digital currencies have advantages such as financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly.

"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,” he says. “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."

Crypto transactions will be possible for PayPal’s 346 million customers and 26 million merchants through a partnership with Paxos Trust Company. The New York State Department of Financial Services (DFS) has granted the first “conditional BitLicense” to PayPal, making the transactions legal in the U.S.

PayPal users will also be able to use crypto assets to purchase goods and services from vendors that accept PayPal. PayPal will begin to enable buying options in the US over the next few weeks, with a full rollout due early next year.

It wasn’t just the crypto markets reacting positively to the news. PayPal (PYPL) shares immediately hit $215.87 a new all-time high for PYPL.

Institutional Fomo

The PayPal news follows a series of public announcements from large companies who have decided to add Bitcoin to their balance sheet. Following previous announcements from MicroStrategy and Square, UK banking start-up Mode is the latest company to add Bitcoin to its reserves. The fintech said it will convert up to 10% of its cash reserves into Bitcoin as part of a long-term strategy to "protect investor assets from currency debasement."

Jonathan Rowland, Mode CEO says "We believe that Bitcoin is a vehicle for financial empowerment and, through Mode, investors can gain exposure to this asset class through a listed and fully compliant company. Faced with the challenges of COVID and with UK interest rates at the lowest level in the Bank of England’s 326-year history, our confidence in the long-term value of Bitcoin has only increased. Today’s allocation is executed through a modern, forward-looking but prudent treasury management strategy."

Earlier this month, MicroStrategy announced a $425 million purchase of Bitcoin, while Square made a purchase of $50 million.

Institutional Bitcoin

Source: Twitter

Meanwhile, Brave New Coin’s lead analyst Josh Olszewicz says that with so many bullish catalysts there simply aren’t many reasons to be bearish at the moment.

On a new episode of Brave New Coin’s Crypto Conversation podcast, Olszewicz says it’s possible that Bitcoin will reach a new all time high in the near future. “The way I look at it is to ask what is the rate of change in the current trend? That gives us a timeline for price expectation. This suggests that if the current rate of change continues we can expect that by January price should be somewhere around $18-$20k. Those numbers sound insane but as long as the trend remains intact, there aren’t many reasons to be bearish right now."

Possible bear triggers would be a legacy market crash or a geopolitical event such as an unexpected outcome to the U.S. election.

Bitcoin has a short history of its price being in five figures. The time it has spent above $12k is even shorter, just 61 days or so. To put this in context, Olszewicz says it’s important to note that “the biggest thing we’re doing now is normalizing five digits versus four digits. In 2017 it was more of a parabolic rise, there were simply more buyers than sellers and price didn’t really matter. When they aren’t enough sellers to meet the demand the price just keeps going up. When you have a bull trend you have to let a runner run. If this goes to 20K people will feel euphoric, but it’s just a number, it could go much higher.”

Olszewicz says that Bitcoin’s dominance is back above the 200-day moving average for the time since May. This is a sign that traders are anticipating further Bitcoin upside ahead.

Bitcoin Price Chart 22 October

Source: BNC

Finally, Bitcoin bull and market commentator Raoul Pal posted the Bitcoin chart. He said “The monthly log chart with regression lines is really something to behold. One of the nicest, most powerful chart patterns I’ve ever seen.”

Bitcoin Price Chart 3


ADVERTISE WITH BRAVE NEW COIN

BNC AdvertisingPlanning your 2024 crypto-media spend? Brave New Coin’s combined website, podcast, newsletters and YouTube channel deliver over 500,000 brand impressions a month to engaged crypto fans worldwide.
Don’t miss out – Find out more today


ADVERTISEMENT
Advertise with BNC
ADVERTISEMENT
Advertise with BNC
BNC Newsletters: A weekly digest of the most important news and analysis.
ADVERTISEMENT
Advertise with BNC
Submit an event on bravenewcoin.com
Latest Insights More
ADVERTISEMENT
Advertise with BNC