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The share price of e-commerce giant Paypal soared to a new all-time high of $223.16 on Monday, December 14. Since November 12, the payment giant has opened the way for US customers to start trading cryptocurrencies, and the stock price has soared by 17%.
After Paypal recently announced a decline in third-quarter earnings in October, the stock performed record-breaking. Although the subsequent performance forced Paypal not to provide preliminary guidance for 2021, it is believed that cryptocurrency trading services will lead to a change in the company’s fortunes.
To illustrate this, according to a report, Paypal stock bulls expect online “in the holiday shopping season, during the coronavirus pandemic, the penetration of total retail spending will continue to grow.” To support these bullish sentiments, the report quoted Deutsche Bank analyst Brian Keane as saying:
A recent survey by PYPL shows that 54% of PYPL users are interested in their encryption products. We believe that so far, the demand has been strong. The frequency of encrypted users’ access to the PYPL business portal is stronger, which will lead to higher customer engagement and more monetizable transactions.
At the same time, starting in early 2021, Paypal customers will also be able to use cryptocurrency to shop at 28 million merchants on its network. This may lead to increased demand for cryptocurrencies from Paypal customers and ultimately increase the company’s revenue.
At the same time, when Paypal’s stock reached a new high, Abra’s CEO and co-founder Bill Barhydt tweeted that the demand for Bitcoin on the payment giant’s platform has now exceeded the new currency’s Daily supply. Barid wrote:
Paypal (alone) now meets the demand for bitcoins more than the number of bitcoins created daily. In 2021 or 22nd, (very likely) you will see retail Bitcoin ETFs. At that time, demand may rise 100 times. Although I discourage using Paypal to buy Bitcoin (Abraglobal is this way)…Wow.
Nevertheless, despite Paypal’s encryption service having an impact on the price of BTC, Bitcoins like Barhydt are still cautious about the impact of the company’s encryption policy on adoption efforts. Paypal has previously stated that its customers will not be able to withdraw or transfer their cryptocurrency to external wallets.But people like Twitter user Anthony Acquadro debate “Those who are involved in expanding the space must be welcomed.”
At the same time, at the time of writing, Paypal stock has fallen back to $220.79, but this price is still “higher than the bottom of the cup buying price of 215.93”.
Do you think the surge in Paypal stock is related to the company’s encryption services? Tell us what you think in the comments section below.
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