![]() ![]() However, Square was already a leader among cryptocurrency stocks, allowing people to use its Cash App to buy, store, withdraw and deposit bitcoins. For a company that is building products based on a more inclusive future, this investment is a step on that journey." "As it grows in adoption, we intend to learn and participate in a disciplined way. "We believe that Bitcoin has the potential to be a more ubiquitous currency in the future," Chief Financial Officer Amrita Ahuja said in a release. Namely, that it bought 4,709 bitcoins for $50 million – an investment that represented 1% of total assets as of the end of Q2 2020. Square ( SQ (opens in new tab), $238.70), another payments company that's known for its card-reading hardware used by small businesses, also made an announcement regarding Bitcoin in October. That's reflected in a consensus Buy rating, according to S&P Global Market Intelligence. They collectively believe PayPal will average 24.1% earnings growth annually over the next three to five years. "We've got a tremendous amount of really great results going on tactically with our crypto efforts," stated CEO Dan Schulman.Īs far as cryptocurrency stocks go, Wall Street analysts are upbeat on this one. The push for incorporating cryptocurrencies was a big reason why. There were 14.5 million new accounts formed, and payment volume was $20 billion higher than expected. In the first quarter of this year, PayPal saw revenue rise 29% year-over-year, and total payment volume jumped 50%. Their business model of collecting a small "toll" for every financial transaction processed should help PYPL expand its bottom line when it begins to apply its fees to crypto transactions in 2021. That's a massive figure that only makes Bitcoin more useful as a digital store of wealth thanks to the "network effect" (opens in new tab) – a concept PayPal understands well from when it was part of former parent company eBay ( EBAY (opens in new tab)).Īllowing users to buy and sell Bitcoin on its platform naturally opens up a new source of revenue for the company. If that 17% figure actually translates across all 392 million PayPal users worldwide, that indicates nearly 67 million people have started holding some amount of wealth in cryptocurrency. "Crypto functionality is now part of Top 5 finance apps," say Piper Sandler analysts Christopher Donat and Crispin Love, who rate PYPL at Buy. Investment firm and hedge fund Pantera Capital wrote in a letter to shareholders that "PayPal and (Square's Cash App) are already buying more than 100% of all newly-issued bitcoins." PayPal Holdings ( PYPL (opens in new tab), $288.12) announced in October a service that would allow users to hold Bitcoin, as well as the Ethereum, Bitcoin Cash and Litecoin cryptocurrencies.īefore the end of the year, Mizuho Securities survey of 380 users showed that, within roughly one month, 17% had already used PayPal to buy or sell the cryptocurrency.
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