In a recently published report, digital asset investment firm Pantera Capital mentions that a Bitcoin scarcity is at the heart of the fresh price increase and that the majority of recently minted Bitcoins are being picked up by PayPal.
Pantera Capital asserts that the payment giant’s new digital asset service is already having a huge impact. It further mentioned that the company is grabbing up around seventy percent of all the new Bitcoin in circulation.
Citing the data from itBit, Pantera claims:
“When PayPal went live, volume started exploding. The increase in itBit volume implies that within four weeks of going live, PayPal is already buying almost 70% of the new supply of bitcoins.”
As per Pantera, the data indicates that PayPal and Cash App together are purchasing all of the newly-issued BTC.
The monetary policy of Bitcoin is programmed to be deflationary over time. With large-scale espousal, that leads to higher buying power and supply shortage. Pantera further claims that it is the supply shortage that is causing Bitcoin’s parabolic rise.
Broader adoption means the virtual currency has chances of sustaining higher price levels. Even though Bitcoin stays highly volatile, it carved out an unusually long period of stability before propelling higher over the last 2 months.
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