{"id":6396,"date":"2020-10-25T15:09:16","date_gmt":"2020-10-25T19:09:16","guid":{"rendered":"https:\/\/cointelegraph.com\/magazine\/?p=6396"},"modified":"2020-10-25T16:09:09","modified_gmt":"2020-10-25T20:09:09","slug":"paypal-bitcoin-plans-critics-hodlers-digest-oct-19-25","status":"publish","type":"post","link":"https:\/\/cointelegraph.com\/magazine\/2020\/10\/25\/paypal-bitcoin-plans-critics-hodlers-digest-oct-19-25","title":{"rendered":"PayPal special! Crypto plans revealed, Bitcoin\u2019s reaction, critics circle: Hodler\u2019s Digest, Oct. 19\u201325"},"content":{"rendered":"

Coming every Sunday, <\/i><\/b>Hodler\u2019s Digest<\/i><\/b><\/a> will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more \u2014 a week on Cointelegraph in one link.<\/i><\/b><\/p>\n

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Top Stories This Week<\/b><\/h2>\n

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PayPal to offer crypto payments starting in 2021<\/b><\/a>
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When rumors started circulating in June that <\/span>PayPal was planning to launch a crypto service<\/span><\/a>, the fintech giant was tight-lipped.<\/span><\/p>\n

But this week, PayPal was ready to show its hand, confirming that it will<\/b> allow its 346 million active accounts to buy and sell cryptocurrencies.<\/b><\/p>\n

It isn\u2019t an exaggeration to say that this is a huge deal for the mainstream adoption of digital assets. This will introduce large numbers of everyday consumers to crypto for the first time.<\/span><\/p>\n

Initially, PayPal will support Bitcoin, Ether, Bitcoin Cash and Litecoin. <\/b>U.S. account owners are going to get this new functionality first, with \u201cselect international markets\u201d to follow later.<\/span><\/p>\n

No fees are going to be charged for conversions until the end of this year. <\/span>However, merchants won\u2019t be able to support crypto transactions until the first half of 2021.<\/b><\/p>\n

Announcing the news, PayPal CEO Dan Schulman said digital currencies offer \u201cclear advantages\u201d when it comes to financial inclusion, payment speeds and enabling governments to distribute funds to citizens quickly.<\/span><\/p>\n

\"Dan<\/p>\n

<\/b>Bitcoin blasts through\u00a0$13,000 following PayPal\u2019s entrance into crypto<\/a><\/b><\/h4>\n

Unsurprisingly, PayPal\u2019s big news served as dynamite for Bitcoin. <\/span>The world\u2019s biggest cryptocurrency smashed through $13,000 on Wednesday, gaining more than $1,000. <\/b>That\u2019s only the third time that BTC has hit this level since its record high in 2017.<\/span><\/p>\n

All of this helps strengthen Bitcoin\u2019s position. <\/b>Even before the announcement, BTC had enjoyed a sustained period in five-figure territory after spending most of the past three months trading above <\/span>$10,000<\/b>.<\/span><\/p>\n

Mati Greenspan, the founder of Quantum Economics, said the PayPal link was undeniable: <\/span>\u201cThere\u2019s no doubt in my mind that this bit of news is almost solely responsible for today\u2019s extended gains.\u201d<\/b><\/p>\n

other cryptocurrencies that PayPal\u2019s going to support also enjoyed chunky gains on Wednesday. <\/span>ETH was up 8%, BCH surged 9%, and LTC rose by a whopping 15%<\/b>.<\/span><\/p>\n

And it wasn\u2019t just the crypto industry that was going wild. In the aftermath of the news, <\/span>PYPL\u2019s share price hit a record high<\/span><\/a>. <\/span>Unfortunately, the uptick wasn\u2019t enough to prevent Bitcoin\u2019s market cap from <\/b>overtaking<\/b><\/a> PayPal\u2019s on Thursday.<\/b><\/p>\n

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PayPal rumored to be eyeing acquisition of crypto custodian BitGo<\/a><\/b><\/h4>\n

Inevitably, attention now turns to what PayPal\u2019s offering will look like, whether crypto exchanges need to be worried, and the company\u2019s plans for the future.<\/span><\/p>\n

We\u2019re starting to get an idea of what to expect. <\/b>PayPal has partnered with Paxos to deliver the service, and it has obtained a conditional cryptocurrency license from the New York State Department of Financial Services.<\/span><\/p>\n

On Friday, reports from Bloomberg suggested that PayPal is looking to acquire a crypto asset custody firm, adding that the fintech giant is currently in talks with BitGo, which helps investors store digital assets securely.<\/span><\/p>\n

However, that report added: \u201cTalks could still fall apart and PayPal could opt to buy other targets.\u201d<\/b><\/p>\n

Meltem Demirors, the chief security officer of the crypto asset manager CoinShares, has predicted that <\/span>PayPal will seek to launch a stablecoin<\/span><\/a> \u201cin the next six to 12 months.\u201d <\/span>This would be a sting in the tail for Facebook, given how PayPal <\/b>left<\/b> its embattled Libra project.<\/b><\/p>\n

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<\/b>Not everyone in the crypto industry is thrilled about PayPal\u2019s recent news<\/a><\/b><\/h4>\n

Yes, there has been enthusiasm over PayPal\u2019s plans, with the analyst Willy Woo suggesting that <\/span>the service could easily treble Bitcoin\u2019s user base<\/span><\/a>. <\/span>But not everyone is cracking open the champagne.<\/b><\/p>\n

People who buy crypto on PayPal won\u2019t be able to withdraw it to a wallet off the platform, prompting critics to say it\u2019s another case of \u201cnot your keys, not your coins.\u201d<\/span><\/p>\n

SatoshiLabs, the team behind the Trezor hardware wallet, wrote:<\/span> \u201cIf millions of newcomers are onboarded to Bitcoin by PayPal, there could be a very serious information gap that jeopardizes their experience and undermines key principles of cryptocurrency.\u201d<\/b><\/p>\n

It is also concerned about how PayPal\u2019s clout in electronic payments \u201cwill be interpreted as expertise in crypto.\u201d<\/span><\/p>\n

Given how Satoshi Nakamoto\u2019s vision was to decentralize finance and remove middlemen, some crypto purists will also be horrified at PayPal wading into the space.<\/b><\/p>\n

But there are other practicalities to worry about \u2014 <\/span>and one of them is tax<\/span><\/a>. Every sale of cryptocurrency becomes a taxable event, especially if it\u2019s sold for more than it was bought for. <\/span>It\u2019s very possible that the implications of this could be lost on crypto noobs.<\/b><\/p>\n

\"Meltme<\/p>\n

<\/b>And in other news\u2026<\/b><\/h4>\n

Of course, there was plenty of other news in the crypto and blockchain sector this week.<\/b><\/p>\n

The Chicago Mercantile Exchange quietly overtook BitMEX to become <\/span>the world\u2019s second-biggest futures market<\/span><\/a> \u2014 buoyed by rising institutional demand. <\/span>All this came as the crypto fund manager Grayscale Investments <\/b>increased its assets under management by $1 billion<\/b><\/a> in the space of a week.<\/b><\/p>\n

Data from Messari showed that <\/span>daily transaction volumes on the Ethereum network are twice those of Bitcoin<\/span><\/a> \u2014 putting the blockchain on track to process $1 trillion this year. <\/span>And in news that\u2019ll make exasperated DeFi users breathe a sigh of relief, a ConsenSys developer predicted that the Ethereum 2.0 beacon chain genesis <\/b>will happen in the next six to eight weeks<\/b><\/a>.<\/b><\/p>\n

Speaking of DeFi, the <\/span>funds locked in protocols surged by $1 billion<\/span><\/a> as analysts predicted we could see a bull run following on from the U.S. election. <\/span>Meanwhile, the U.S. acting comptroller of the currency predicted that <\/b>DeFi could render the financial services offered by banks obsolete<\/b><\/a> \u2014 just like email disrupted the postal service.<\/b><\/p>\n

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Winners and Losers<\/b><\/h2>\n

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\"Top<\/span><\/p>\n

At the end of the week, Bitcoin is at <\/span>$12,994.86<\/b>, Ether at <\/span>$409.13 <\/b>and XRP at <\/span>$0.25<\/b>. The total market cap is at <\/span>$395,014,912,585<\/b>.<\/span><\/p>\n

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are <\/span>Quant (47.26%)<\/b>, <\/span>Reserve Rights (40.41%) <\/b>and <\/span>Ocean Protocol (33.23%)<\/b>. The top three altcoin losers of the week are <\/span>Crypto.com Coin (18.81%)<\/b>, <\/span>ABBC Coin (17.74%)<\/b> and <\/span>HedgeTrade (16.31%)<\/b>.<\/span><\/p>\n

For more info on crypto prices, make sure to read <\/span>Cointelegraph\u2019s market analysis<\/span><\/a>.\u00a0<\/span><\/p>\n

 <\/p>\n

Most Memorable Quotations<\/b><\/h2>\n

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\u201cThere goes wBTC. The majority of wrapped Bitcoin is custodied by BitGo. PayPal is not a good actor in this space. Position accordingly.\u201d<\/span><\/p><\/blockquote>\n

THORChain<\/b><\/a><\/p>\n

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\u201cIf millions of newcomers are onboarded to Bitcoin by PayPal, there could be a very serious information gap that jeopardizes their experience and undermines key principles of cryptocurrency.\u201d<\/span><\/p><\/blockquote>\n

SatoshiLabs<\/b><\/a><\/p>\n

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\u201cCrypto is about financial freedom. It\u2019s modern money that anyone anywhere can truly control. While we\u2019re excited to see a new audience gain access, a non-custodial approach limits opportunity to self-custody your crypto or transact freely.\u201d<\/span><\/p><\/blockquote>\n

Peter Smith<\/b><\/a>, Blockchain.com CEO<\/b><\/p>\n

 <\/p>\n

\u201cThis is definitely a bullish sign for Bitcoin and other cryptocurrencies. Crypto is all about trust, and PayPal has a very high level of trust with its users […] If the UI\/UX of the service is done right, we will see millions of new users join each month.\u201d<\/span><\/p><\/blockquote>\n

Alex Mashinsky<\/b><\/a>, Celsius CEO\u00a0<\/b><\/p>\n

\"Chamath<\/span><\/p>\n

\u201cWe are eager to work with central banks and regulators around the world to offer our support, and to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce.\u201d<\/span><\/p><\/blockquote>\n

Dan Schulman<\/b><\/a>, PayPal CEO<\/b><\/p>\n

 <\/p>\n

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Prediction of the Week<\/b><\/h2>\n

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Bitcoin price rise to $500,000 is inevitable, Winklevoss twins say<\/a> <\/b><\/h4>\n

Unsurprisingly, the Winklevoss twins were brimming with enthusiasm in the wake of PayPal\u2019s announcement.<\/span><\/p>\n

Tyler Winklevoss<\/span> tweeted<\/span><\/a>: <\/span>\u201cPayPal is an important bridge between the mainland and the island of crypto. The diaspora from legacy finance is happening and this is the kind of infrastructure that will help make that happen. Soon there will b a flippening and crypto will b the mainland & fiat the island.\u201d<\/b><\/p>\n

This week, the twins doubled down on their prediction that Bitcoin will eventually hit <\/span>$500,000<\/b>, telling podcast host Peter McCormack that it\u2019s a matter of when, not if.<\/span><\/p>\n

\u201cI would sort of contend that $500,000 Bitcoin is actually pretty conservative and the game hasn\u2019t even really started,\u201d<\/b> Cameron noted.<\/span><\/p>\n

 <\/p>\n

FUD of the Week<\/b><\/h2>\n

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<\/b>First ransomware attack in 2020 election hits voting infrastructure in Georgia<\/a><\/b><\/h4>\n

A ransomware attack targeting the government systems of Georgia\u2019s Hall County impacted key voting infrastructure, it has been revealed.<\/span><\/p>\n

\u201cCritical systems\u201d within its networks were affected, and CNN says the incident may be the first ransomware attack in the 2020 election.<\/b><\/p>\n

Officials said the county\u2019s voter signature database and voting precinct map were heavily impacted by the hack but stressed that the voting process for citizens is unaffected.<\/span><\/p>\n

Brett Callow, from the cybersecurity firm Emsisoft, told Cointelegraph: <\/span>\u201cThere is a very real risk that they may shake voter confidence in the integrity of the vote, especially as confidence may already be quite low.\u201d<\/b><\/p>\n

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<\/b>OKEx\u2019s lips remain sealed on its sudden crypto withdrawal freeze<\/a><\/b><\/h4>\n

There\u2019s still no sign of OKEx\u2019s cryptocurrency withdrawals returning to normal \u2014 nine days after they were suddenly suspended.<\/span><\/p>\n

The ongoing suspension has been puzzling to many, but the exchange\u2019s representatives maintain that the move was solely because one of the company\u2019s private key holders has been cooperating with a Chinese public security bureau.<\/b><\/p>\n

OKEx CEO Jay Hao has told Cointelegraph that the company is determined to reinstate withdrawals as soon as possible, adding: <\/span>\u201cWe wholeheartedly apologize for this.\u201d<\/b><\/p>\n

Some users are starting to <\/span>warn that their patience is wearing thin<\/span><\/a>, expressing frustration at the lack of transparency surrounding what\u2019s going on.<\/span><\/p>\n

One tweeted: <\/span>\u201cWhere is your CEO Jay Hao? He has to interact and give updated info frequently. When something happens with Binance, CZ tweets every hour.\u201d<\/b><\/p>\n

And another wrote:<\/span> \u201cIt\u2019s a bit weird one of the biggest exchanges in the world isn\u2019t letting us withdraw money for so long.\u201d<\/b><\/p>\n

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<\/b>Filecoin creator denies strike allegations<\/a><\/b><\/h4>\n

The creator of the blockchain-based data storage platform Filecoin has dismissed allegations that miners of its token have gone on strike as \u201cnonsense.\u201d<\/span><\/p>\n

Refuting the claims, Juan Benet claimed on Twitter: <\/span>\u201cWhat is happening is that miners are growing slower than before launch. This is in great part because the network is no longer subsidizing their pledge and fee costs \u2014 fees cost real money now, and miners need to match growth rate to token flow.\u201d<\/b><\/p>\n

It had been reported that five of the largest Filecoin miners turned off thousands of rigs to protest the blockchain\u2019s economic model, which means that miners are required to stake FIL as collateral when producing a block. <\/span>The problem is that many miners are apparently coming up short in the number of tokens needed.<\/b><\/p>\n

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Best Cointelegraph Features<\/b><\/h2>\n

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<\/b>Regulation will keep PayPal\u2019s new crypto services from looking anything like crypto<\/a><\/b><\/h4>\n

Cointelegraph\u2019s Kollen Post says that, for now, PayPal\u2019s crypto payments are more about satisfying regulators than providing users with crypto capabilities.<\/span><\/p>\n

 <\/p>\n

<\/b>How to build a crypto mining rig in 2020 to earn Bitcoin and Ether<\/a><\/b><\/h4>\n

Mining with home rigs is back, so Elena Perez takes a look at what those interested need to know to put together their own rig at home.<\/span><\/p>\n

 <\/p>\n

<\/b>Frozen out? Bitcoin price correlation to other assets still undefined<\/a><\/b><\/h4>\n

Fidelity\u2019s report claiming Bitcoin is a non-correlated asset has sparked discussion, but as Benjamin Pirus reports, not all agree with the assessment.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more \u2014 one week on Cointelegraph in one link!<\/p>\n","protected":false},"author":15,"featured_media":6401,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"mc4wp_mailchimp_campaign":[],"_links_to":"","_links_to_target":""},"categories":[2413],"tags":[],"yst_prominent_words":[225,222,809,701,2216,2236],"_links":{"self":[{"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/posts\/6396"}],"collection":[{"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/comments?post=6396"}],"version-history":[{"count":4,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/posts\/6396\/revisions"}],"predecessor-version":[{"id":6405,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/posts\/6396\/revisions\/6405"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/media\/6401"}],"wp:attachment":[{"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/media?parent=6396"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/categories?post=6396"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/tags?post=6396"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/cointelegraph.com\/magazine\/wp-json\/wp\/v2\/yst_prominent_words?post=6396"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}