Ever since Paypal introduced support for cryptocurrencies, people have looked differently at this company. Due to overwhelming demand, the firm is raising purchase limits. It is now possible to buy up to $100,000 in cryptocurrency per week, assuming one is an eligible customer in the US.
An Expected Move By PayPal
Everyone knew that PayPal and cryptocurrency would be a good match. Bitcoin and similar crypto-assets have tremendous mainstream appeal. All they need is a convenient purchase option. Traditional exchanges do not always fit that bill, creating unnecessary friction. With PayPal on board, the process becomes a lot more straightforward. However, users do not own the cryptocurrency they purchase, as they merely obtain price exposure.
Despite that aspect, there is an apparent overwhelming demand for Bitcoin and other crypto-assets through this service. So much so that the company has to raise purchase limits. An intriguing decision, given how this functionality went live less than six months ago. The option to buy cryptocurrency conveniently – in the US – appeals to many people.
As of this week, eligible users can buy up to $100,000 per week in cryptocurrency. A substantial amount as most exchanges don’t offer such limits. Moreover, there is no annual purchase limit, creating a lot of opportunities. In theory, an eligible user can buy over $5 million of crypto per year via PayPal. That can undoubtedly open the flood gates to institutional investors and wealthy individuals.
Furthermore, Paypal’s blog post confirms the company will keep working on educational guides for crypto assets. However, there are still many misconceptions and questions that need to be answered clearly and decisively. In addition, onboarding new users to crypto will require a fair bit of education, but that is necessary. Everyone needs to understand what they are getting themselves into before making financial commitments.
What Does It Mean For Bitcoin?
Given the current market momentum, Bitcoin and other crypto assets need a bit of help. Tapping into more purchasing liquidity is beneficial, although not necessarily in this case. PayPal lets users obtain Bitcoin exposure rather than Bitcoin ownership. As such, these raised limits will make little or no impact on the current market trend. More importantly, there will be no steep exchange outflow all of a sudden either.
One also has to wonder who would have $100,000 per week laying around to spend on Bitcoin. Some people may fall into this category, but the vast majority don’t. Thus, the increased limits will only benefit a select group of users and will have no immediate price impact. It is unfortunate, but Bitcoin’s momentum will have to come from elsewhere. Whether that is even a possibility remains up in the air.
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