Bitcoin Skyrockets Near $17,000 Thanks to PayPal and Venmo

October 21, 2020

Bitcoin’s price pulverized resistance at $12,000 USD throughout Tuesday night, and is now flirting with $17,000 Canadian, thanks to PayPal announcing that users will officially be able to buy and sell Bitcoin using both PayPal and Venmo.

The news that another fiat-to-crypto on-ramp is now available to users is only good for the cryptocurrency world in general, but is it better than being a Netcoins customer?

What the PayPal and Venmo Announcement Means for Bitcoin and Users

Thanks to the announcement, cryptocurrency enthusiasts will now be able to buy, sell and hold Bitcoin, Ethereum, Litecoin and Bitcoin Cash in digital wallets and use it to shop at more than 26 million merchants tied to both networks. Prominent institutional investor and Bitcoin bull Mike Novogratz tweeted that the news is the biggest of the year for cryptocurrencies. He is right.

Along with several publicly traded companies making major investments in Bitcoin, the fact that 26 million merchants will now service their customers using crypto through PayPal, one of the largest and most popular payment gateways in the world, is huge. Still, there is also a downside to the news.

Increased Centralization of Wealth

Applying decentralized technology to digital currencies is supposed to put more money back in the hands of the individual. With large publicly traded corporations dipping their hands in the Bitcoin honeypot, they are actually just transferring wealth from governments to corporations. That’s good as an investor if you’re riding the wave, but it’s not necessarily good for individuals around the world who can’t get access to a banking system or don’t possess a significant amount of wealth.

For many years now, many thought leaders in the cryptocurrency space have talked about the virtues of being able to use blockchain technology to help people in the developing world and Third World nations gain access to currency. The reality is the Bitcoin revolution seems to be making rich people get richer. That’s good for Westerners like you and me, not so good for the overall mission of decentralized currencies. Plus, there’s an even bigger red flag at play here.

Not Your Keys, Not Your Crypto

If PayPal and Venmo allow customers to hold cryptocurrency in digital wallets tied to both companies, it means those companies own the private keys to your money. One major hack could see hundreds of millions or even billions of dollars worth of crypto liquidity moved out of your wallets and into the wallets of the wrong people, with no way to get your money back. Yes, PayPal and Venmo do offer great purchase protection guarantees, but how are those services going to guarantee taking care of cryptocurrency when there is no Bitcoin CEO to do business with or negotiate security with?

It’s for this reason that although the announcement is sure to light a fire under Bitcoin and send it to the moon, registering for a free account on a trusted cryptocurrency exchange in Canada like Netcoins is still your best bet. You can buy your crypto, hold it in your own wallet and ultimately still make purchases with PayPal merchants without giving up your private keys.

Thanks for reading. For more blogs on all things Bitcoin, you can read more here.

If you’re looking to purchase Bitcoin or other cryptocurrencies, buy Bitcoin with Netcoins. Netcoins is a fully regulated crypto trading platform in Canada.