The past week has been significant for most cryptocurrencies, including Bitcoin (BTC), which has surged to a new high in 2020, rising about 110% since its last halving to $ 18,448.
The demand for BTC exceeded the supply
Pantera Capital, a crypto investment company, recently published a report stating that the emergence of payment giant PayPal integrating Bitcoin and other cryptocurrencies into its platform has led to a significant increase in the value of Bitcoin, and it is now unknown where the rally will stop.
In its official blog, the us-based investment company reports that the shortage of BTC in the market is the main reason for the recent price increase and that the majority of newly mined Bitcoins are purchased by PayPal.
PayPal recently created a new service that allows customers to store, sell, and buy cryptocurrency directly from their PayPal accounts. Given that PayPal has more than 300 million active users, The new service has a huge impact on the price of the leading cryptocurrency.
Pantera Capital said that since the launch of PayPal, the volume of trading in BTC has started to grow. The company is already purchasing almost 70% of the new Bitcoin offering. According to experts, the demand for bitcoin via PayPal has already exceeded the supply.
A shortage of Bitcoin supply and higher demand lead to higher prices. The entry of large financial firms such as Square Mobile Payment Company and PayPal into the market has set a good example for others. Other major financial institutions will follow suit. Of course, all financial institutions, such as banks, will participate in the race to service cryptocurrencies. The supply deficit will become even more unbalanced as more firms will seek to invest in Bitcoin and thus raise the price. According to Pantera Capital: “The only way to balance supply and demand is for a higher price.”
Alternative coins are also impressive
The growth of Bitcoin was also followed by the leading altcoins: Ethereum (ETH), Ripple (XRP) and Bitcoin Cash (BCH), which showed impressive bullish movements.
The movement seen among these three crypto assets suggests in some ways that the adoption of cryptocurrencies seen in recent days, weeks, and months is primarily focused on more than just Bitcoin.
While the rise in the price of Ethereum may be due to the increased performance of decentralized financial DApps created on the network, the strong movements of XRP and BCH may be due to their strong fundamentals as a means of payment.
Over the past 24 hours, ETH has grown by 6.4%. At the time of writing, ETH was trading at $ 580, according to Coingecko. XRP, on the other hand, is showing some of the strongest moves: a 74% gain over the past 14 days, trading at $ 0.457.
BCH has not been left out of this massive price movement. It is up 7.3% over the past 30 days, and is currently trading at $ 292.4.
Big profits, but not high enough
Despite the impressive success of these top altcoins, they are still far from reaching and surpassing their historical highs. These figures are compared to bitcoin, which is currently trading at $ 18,448, just 6.3% below the historical high of $ 19,665. 39 set on December 16, 2017, according to data obtained by Coingecko.
The path to breaking this historical high is a foregone conclusion, as the us dollar is destined to fall even further even with the deployment of the COVID-19 vaccine, and BTC is expected to grow further in 2021.
ETH is up 237% over the same period last year, but it still has a very long way to go to break the all-time high (ATH) of $ 1,448 set on January 13, 2018. XRP is 87.4% behind the $ 3.40 Ath reached on January 7, 2018, and BCH is 92.4% different from its $ 3785.82 ATH set on December 20, 2017.
Thanks to the movements made by these coins, the desire to break your own ATH records will be an important milestone to watch.