Bitcoin jumps to multi-year high after PayPal enters cryptosphere

Payments giant plans to introduce crypto buying and selling features

Bitcoin jumped to its highest point in over two and half years on Wednesday afternoon, after PayPal announced its intention to enable the buying and selling of cryptos for its 346 million active users.

The CEO of the payments giant, Dan Schulman, stated:

“The shift to digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly.”

The firm obtained a “conditional” New York BitLicense, with the state’s Department of Financial Services (DFS) stating it had granted the notoriously hard to get permit to PayPal for a partnership with Paxos Trust Company, a crypto brokerage.

At launch PayPal will allow the sale and purchase of Bitcoin, Ethereum, Bitcoin Cash and Litecoin.

The company stated: “In effect, cryptocurrency simply becomes another funding source inside the PayPal digital wallet, adding enhanced utility to cryptocurrency holders, while addressing previous concerns surrounding volatility, cost and speed of cryptocurrency-based transactions.”

The fact that those buying cryptos on PayPal “will not be provided with a private key” has led to scepticism from Bitcoin purists who hold fast to the notion “Not your keys, not your coins.”

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Indeed, the fact that Schulman embraced cryptos within the same breath as committing to work with central banks and regulators “to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce” will certainly alarm those who viewed cryptos as a way to disentangle themselves from state control.

The overall reaction to PayPal entering the cryptosphere has been overwhelmingly positive, however.

Indeed, the news boosted the world’s leading cryptocurrency even further upwards. Having broken the $12,000 threshold shortly before the announcement, Bitcoin surged to its highest point in 2020 thus far.

By late-afternoon, Bitcoin traded up 6.9 per cent at $12,728, its highest point since January 2018.

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