Market volatility is not a foreign concept when it comes to Bitcoin. Rather, it’s this volatility that piqued the interest of many traders and investors.
This interest mostly came from millennials and the Gen Z demographic they helped drive Bitcoin’s bullish price over the years.
Even in 2020 where global sanctions are imposed in lieu of the COVID-19 pandemic, Bitcoin continues to rise amidst economic uncertainties.
Adoption has been growing and now Bitcoin is accepted by several businesses all over the world.
How hard is it to spend Bitcoin?
Despite its popularity, not all stores are accepting Bitcoin. Though the number is rising, local stores where you buy your daily goods most likely do not accept this currency.
There are 2 common reasons for this:
1. Some Store Owners are Afraid that it’ll Lose Value
One of the main concerns is its volatility. Bitcoin’s value could surge up to 30% overnight, and then it could go down just as easily in a matter of hours.
As a result, quite a number of established businesses were hesitant to accept it. In fact, around the early 2010’s, most spenders needed to convert Bitcoin into fiat to buy goods and services.
Something to keep in mind is that in the last ten years or so, many fiat currencies actually lost value while Bitcoin just kept rising.
2. The Technology is A Bit Tricky to Understand
The learning curve is steep when diving into blockchain technology and cryptocurrency. This is a major hindrance for people to use Bitcoin.
Given that this technology is relatively new, there are still many areas that needed to be improved on. For example, there needs to be a better safety net in case you lose your private keys (losing access to your private keys could mean that your money’s gone for good).
With such limitations, boomers were hesitant to trust cryptocurrency in general. This may be viewed as a loss to the crypto market since it missed out on a wealthier demographic.
In the U.S. alone, the boomer generation accounts for up to 70% of the nation’s disposable income.
For these reasons, Bitcoin is rather viewed as an asset than an instrument of exchange.
Fortunately, as blockchain technology continues to evolve over the years, more institutions are now backing up cryptocurrency.
This year, Bitcoin may see its price surge upwards since Paypal, one of the most established payment gateways, will launch a new service that will accommodate cryptocurrency.
Why is PayPal Accepting Bitcoin?
According to Dan Schulman, CEO of Paypal, the move to introduce Bitcoin to their platform will help “facilitate the understanding, redemption, and interoperability of these new instruments of exchange.”
He also added that the shift to digital forms of currencies is inevitable. Paypal’s foresight to open up their platform to cryptocurrency will likely let them stay ahead of the digital payments industry.
Another important reason why PayPal is accepting Bitcoin is that the platform can facilitate faster transactions.
Good News for Crypto
So, what does this mean for crypto?
With PayPal’s adoption of cryptocurrency, it is easier for the boomer generation (who are more comfortable with fiat) to finally make the connection that crypto has the potential to be used for daily transactions.
Plus, this move also allows Small and Medium Enterprises (SME) who use PayPal and other digital modes of payment to jump into crypto.
That way, they can also take advantage of the its benefits such as:
- Low transaction fees for international payments.
- Access to a market who don’t have traditional bank accounts or credit cards.
- The decentralised setup of cryptocurrency protects businesses from fraudulent chargebacks.
- Send and receive payments without the approval of an authority.
A lot of people and businesses trust PayPal, and with the company’s support, market sentiments will shift towards crypto favourably. It could also potentially increase Bitcoin’s user base!
And, once it is widely accepted across different demographics, it wouldn’t be a surprise to see crypto become the new standard for payments.
Great News for You
PayPal’s Bitcoin adoption is one of the biggest news events in 2020 for the crypto market. The announcement led Bitcoin’s price to surge by up to 8%. Perhaps, once the service launches, crypto might even become mainstream.
This announcement opened up several opportunities in the crypto market, including but not limited to:
- More users which can help reduce market volatility.
- More technology and platforms will rise up to make trading easier than it normally would.
- Financial institutions will be able to see how they can integrate blockchain technology to improve their systems.
- A paradigm shift to use crypto assets as an instrument of exchange which will result in protecting personal identity information during transactions.
Right now, Bitcoin and other crypto-assets have been performing well during this COVID-19 pandemic, despite earlier negative sentiments.
It’s even on its path to outperform financial stocks according to BNN Bloomberg. Bitcoin itself went on to become one of the best-performing assets and has beaten gold.
And if you’re already into crypto trading, now is a great time to milk the bull run, so to speak. With crypto prices on the rise, you might be able to make the most out of your trades.
Crypto’s future looks brighter than ever
If anything, PayPal’s move suggests a bright future for crypto. It will create a larger momentum for cryptocurrency to become widely accepted in different demographics.
Here are some other reasons the future is looking bright for Cryptocurrencies:
Cryptocurrency has the capacity to disrupt traditional financial systems. For example, it disrupts the stock market in a way that it challenges the centralized authority of the US Dollar.
- Traders and investors who want to expand their ventures globally can do so with cryptocurrencies!
- With cryptocurrency being more in the forefront of the financial sphere, it will be able to address issues that have plagued banks and centralized systems for so many years.
- As it gains more momentum, it will redefine finance and will unlock more opportunities in investments and the way people use money.
- Payment gateways are now seeing the way crypto can redefine the future of finance and are now starting to join the race to integrate it into their systems.
So, if you’re interested to venture into Cryptocurrencies, now looks like a great time!