Bitcoin Transaction Value Reaches $1.3T As it Passes PayPal and Discover
Bitcoin's transaction value has surpassed that of PayPal with an estimated $1.3 trillion.
Bitcoin, the world’s top cryptocurrency by market capitalization, currently sees a lot more in annual transacted value than PayPal and is second only to Visa.
It is argued that bitcoin, due to scaling problems, cannot match the transaction speeds reached by some of the traditional payment services.
However, that idea does not carry any weight where Bitcoin versus PayPal debates is concerned.
Bigger than PayPal
ARK Invest crypto analyst Yassine Elmandjra, says that bitcoin transaction’s dollar value has outperformed that of payment processor PayPal by a wide margin. The top coin has also surpassed the transacted value of credit card Discover.
According to the New York-based analyst, Bitcoin’s $1.3 trillion transacted value seen in 2018 is only “an order of magnitude” away from that of leading processor Visa.
Elmandjra, however, agrees that we cannot compare Bitcoin and say Visa or MasterCard in terms of their Base layer transaction volumes. But he also points out that that was never the intention.
Yet, the top cryptocurrency has seen tremendous growth in its transaction volumes since 2013, the analyst tweeted. He also provided a graph showing the transaction volumes of Visa, MasterCard, UnionPay, and Discover Credit Card.
He then pointed out that approximately $3-4 billion worth of bitcoin was transacted on a daily basis in 2017. The real deal in increased Bitcoin transactions isn’t in the volume, but in the total value, he tweeted.
“Look at the transaction value, NOT the transaction volume.”
Catching Visa won’t be easy
Although Bitcoin will see about $1.3 trillion worth of transactions in 2018, these figures pale in comparison to those Visa has recorded over the years.
Visa handled over $8.9 trillion worth of transactions in 2016, putting the U.S payment giant seven or so paces ahead of bitcoin’s current numbers.
However, the momentum seems to be favoring a chase from Bitcoin, meaning that what appears impossible at the moment may actually happen in the near future.
Data from as far back as 2015 shows that Bitcoin has experienced a tremendous growth rate in terms of transaction value. The top virtual asset reached peak values in 2017 as it saw an increase in transacted value nearly eight times more than what is recorded in 2016.
Bitcoin transactions are expected to continue growing in 2018 and beyond. If it records a performance that matches its 80 percent yearly growth compared to the last five years, it will put itself in a very strong position to challenge Visa.
Bitcoin could reach Visa numbers with the implementation of the Bitcoin Lightning Network (LN), practically overtaking it thereafter. By then, the leading digital currency could theoretically be able to handle more than $13 trillion worth of annual payments.
Debate: Value or Throughput?
To many within crypto circles, Bitcoin needs to find solutions to its scaling problems if it has to compete with the likes of Visa. However, there are some who believe that the original purpose of cryptocurrency was never to compare or compete with these traditional payment processors.
Is it better to go for a higher transaction throughput or to have Bitcoin used for high-value transactions only? It appears that Bitcoin’s slow network and huge transaction fees don’t matter to proponents of value over throughput.
The debate continues, with some within the community maintaining that bitcoin adoption numbers cannot be pegged on transacted value only. This is because most transactions involving Bitcoin are due to speculative trading.