Bitcoin continues its meteoric rise in value, to the point that even the market capitalization of bitcoin briefly crossed the $ 70 billion mark, outperforming PayPal by the same metric, the most widely used online financial network. Amid the growing demand from institutional investors and the rapid rise in worldwide adoption, the price of bitcoin increased from about $ 3,400 to $ 4,400 in a single week. Bitcoin’s market capitalization exceeded that of PayPal, as the value of the entire cryptography market approached the region of $ 150 billion.
As for PayPal and the comparison factor we do here, it is good to comment that Paypal is possibly the most prominent and widely recognized financial network used by online users. In 2016 Paypal processed $ 354 billion in transactions, solidifying its position in the global financial technology industry. As of now, the only two financial networks that are able to compete for the top of the market and the user base of PayPal are Bitcoin and Alibaba.
PayPal and bitcoin are fundamentally different from each other. The first is a financial platform that operates at the top of existing banking systems when dealing with fiduciary coins. Bitcoin is an independent and decentralized financial network of its own, which functions as a digital currency and a secure asset for its users and investors.
Since the beginning of 2016, a growing number of institutional investors and professional traders have begun to consider bitcoin as digital gold or as an active safe haven. Investors began using bitcoin to hedge against the economic uncertainty and volatility of world markets, owing to their tendency to outperform all reserve assets and currencies amid international financial instability. Therefore, the daily volume of bitcoin trade increased drastically as foreign markets matured and the digital currency gained legality and global adoption in many regions.
Centralized financial networks have their disadvantages, specifically in terms of security and efficiency. Most PayPal users are well aware of the extremely inefficient transaction verification process of the network, which can take at least a week to six months. For merchants, the process is even more difficult to manage because of PayPal’s customer protection policy. For example, if a customer on Amazon transacts with PayPal, in most cases, traders must wait about 30 days to receive the transaction.
Bitcoin transactions are not instantaneous. However, with the appropriate fees, payments can be verified in 30 minutes, with three confirmations from the miners.
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