When it comes to listing a definite reason for a Bitcoin price spike, organic growth or metric development hardly gets anyone’s attention but an announcement by a global payments company will take all the credit.
Although Bitcoin was pumping for the previous 6-days as well after PayPal announced its services for Bitcoin and co. coming 2021, the community went bonkers and started acknowledging PayPal’s role is pushing Bitcoin above $13,000 for the first time in 2020.
The announcement also appeared to trigger high market activity in spots and derivatives trading.
— skew (@skewdotcom) October 22, 2020
According to Skew, daily aggregated volumes for BTC spot trading crossed $1 billion on 21st October after failing to cross $500 million for the previous 30-days. A similar activity prevailed in the futures and options volume, with daily volumes surging above every high in the last 30-day period.
Additionally, Bitcoin Options Open-Interest also witnessed a yearly high across various exchanges.
Now, PayPal’s validation of Bitcoin was received with open-arms by certain Bitcoin bulls and these proponents were now expecting a bull-run at the back of its announcement. While such a scenario might unfold, it will be a call of injustice if PayPal takes all the acclaim.
Bitcoin needs PayPal or is it the other way around?
While the above sub-heading is definitely up for debate, events that took place in March 2018 will facilitate better understanding. Bitcoin was fresh off its bullish-stint in December 2017 and the following March, things had relatively cooled down.
However, cryptocurrencies were the talk of the town but David Schulman, PayPal CEO, was less than impressed. Speaking at the Economic Club in Manhattan, New York, Schulman suggested that cryptocurrencies were an ‘experiment’ and that it is very unclear with regards to its direction. Additionally, he indicated that regulations would need to be sorted and a whole number of other things need to fall in place for digital assets.
2 years later, regulations with respect to Bitcoin haven’t been monumentally different but PayPal has jumped onboard to facilitate its services for the king coin.
Bitcoin wasn’t forcing any changes but other corporations were making their moves to be a part of its industry.
So, how huge is PayPal’s announcement?
In 2018, it would have been massive but in all honesty, it isn’t a surprise in 2020. Bitcoin has come a long way since March 2018, and several financial institutions are taking notice. Hence, it is unfair to give complete credit to PayPal for Bitcoin’s bull run. Accolades should be attested to Bitcoin’s resilience as well.
With the price currently consolidating near $13,000, Bitcoin is gearing itself for another potential rally, and when the dust settles, Bitcoin’s credibility as a legitimate asset should shine through.
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