Bitcoin Transaction Value Tops PayPal, Second Only to Visa

The world’s largest cryptocurrency now sees more annual transacted value than PayPal, coming in close second after Visa.

Bigger Transaction Value Than PayPal

According to Yassine Elmandjra, a cryptocurrency analyst at ARK Invest, a New York-based investment firm, the dollar value of all bitcoin transactions has outperformed online payment processor PayPal, as well as the Discover credit card.

“Bitcoin’s base layer transaction volume doesn’t compare to Visa’s, MC’s et al. But it was never supposed to,” Elmandjra tweeted alongside a graph comparing the cryptocurrency’s transaction volume to that of Visa, UnionPay, Mastercard and the Discover card.

(Source: Twitter)

“Look at the transaction *value*, NOT the transaction *volume*,” he said in the following tweet, adding that “$3-4 B worth of bitcoin has been transacted daily in 2017. At ~ $1.3T annually.”

“Bitcoin’s base layer transactional value is within an order of magnitude away from Visa’s,” he concluded.

Despite reports showing $1.3 trillion worth of bitcoin transactions processed in 2018 alone, the cryptocurrency has a long road ahead to dethrone Visa. The U.S.-based payment is a giant in terms of transaction value, handling a reported $8.9 trillion in 2016.

And while a sevenfold increase in transaction value might seem unattainable for bitcoin, the numbers tell a completely different story.

According to data from Blockchain, bitcoin has exhibited a seemingly unstoppable rate of growth since 2015, reaching its peak in 2017 with an eightfold increase in transaction value.

If its current growth speed continues, matching the 80 percent increase per year from 2013 to 2018, bitcoin will be on the road to overtaking Visa in 2022, when it could, in theory, handle over $13 trillion in payments.

What’s More Important, Value or Throughput?

Bitcoin’s seemingly relentless growth has raised many questions concerning the cryptocurrency original purpose.

While some bitcoin investors suggest the coin should scale to the high transactional throughput of payment giants like Visa, others advocate for reserving the coin only for high-value transactions. For the latter, the cryptocurrency’s slow confirmation times and extremely high transaction fees seem to be irrelevant.

Elmandjra also seems to be on board with the high-value transactions idea. The ARK Invest analyst stated that bitcoin was “never supposed to” reach such levels of throughput, tweeting another chart showing the cryptocurrency’s more humbling base layer throughput.

However, the newly published data wasn’t convincing to everybody. One user suggested that the bulk of bitcoin transactions come from “speculative trading,” effectively saying that value is not a worthy means to measure adoption.

Comparing bitcoin with Visa would be, as he put it, equal to comparing apples to oranges, which prompted other users to defend bitcoin saying that speculative trading is a legitimate use case and that neither Visa nor the bitcoin protocol can tell whether trading is speculative or not.

Featured image by Walid Beno

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