PayPal Users Took Advantage of Market Crash, Buying the Dip on Both Bitcoin and Ethereum
In the light of retail involvement on this dip, Su Zhu, CEO of Three Arrows Capital, called this dump “incredibly bullish” — “a fast transfer of supply from the impatient to the patient, from the weak to the strong.”
After the week's brutal opening that wiped billions of dollars from the overall cryptocurrency market, today’s cryptocurrency prices are recovering.
Bitcoin jumped past $51,350 and Ethereum to $1,715. The market is recording gains between 15% to 30%, already pushing the total market capitalization to $1.54 trillion.
Before the market started making a recovery late on Tuesday, the price of Bitcoin dumped to just under $45,000, sliding a good 23% from Sunday’s all-time high of $58,300. As for Ether, things got even worse as it tested even its 2017 ATH.
Ether experienced a flash crash to $1,350, nearly a 34% drop from its peak of $2,040.
While this move was exacerbated by the liquidations but was less than the bull market’s usual 30% to 40% drawdowns, it provided the people an amazing market opportunity after a wild runoff in the past month.
Of people who captured this buy the dip opportunity were PayPal users. The crypto volumes went up to nearly $131 million yesterday. This volume was split for 73% BTC and 27% ETH.
While the PayPal users went in for both BTC and Ether, the volume this time was about half of $242.63 million seen during the January sell-off when the price of Bitcoin fell from $42k to under $29k.
PayPal first allowed its users to start buying the cryptocurrency in October, and the response it received was overwhelming, as per the company's executives.
But it is not just the payment giant that is seeing a huge interest among its users for cryptocurrencies. Payment company Square’s Cash App also had an amazing quarter, as revealed in its Q4 2020 earnings call.
“We've continued to see strong adoption with 3 million customers across Bitcoin throughout the year for Cash App and in January, saw 1 million new to Bitcoin in the month,” said Amrita Ahuja, Chief Financial Officer of Square.
The company further doubled down on its bet on Bitcoin, which its founder and CEO Jack Dorsey believes will be the currency of the internet by buying another 3,318 BTC, now representing 5% of its cash equivalents.
“This dump is incredibly bullish in that it has been a fast transfer of supply from the impatient to the patient, from the weak to the strong,” commented Su Zhu, CEO of Three Arrows Capital, on this increased interest in Bitcoin among retail users.
“Revising all upward targets higher accordingly and needfully,” added Zhu.