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Should You Buy Bitcoin? An In-depth Analysis — The Finance Brief

Why You Should Buy Bitcoin Paypal and Square Allowing Users to Buy, Hold and Sell Cryptocurrency Image from Paypal depicting new Cryptocurrency Payment function

In October, Paypal announced that it will enable cryptocurrencies such as Bitcoin, to be bought and sold on its platform. This has enabled cryptocurrency as a funding source for over 26 million merchants, partially addressing fears many have had regarding the use of Bitcoin as a medium of exchange.

To support this function, Paypal has reportedly purchased more than 70% of newly minted Bitcoin. Together with Square’s (Paypal Competitor) routine bitcoin buying, more than 100% of all newly minted bitcoins are bought by the 2 firms, echoing a statement from Bill Miller in CNBC

The bitcoin story is very easy, it’s supply and demand, Bitcoin’s supply is growing at around 2.5% a year, and the demand is growing faster than that and there’s going to be a fixed number of them. Bill Miller, ex-chairman of Legg Mason Capital Management Support from Prominent Investors

Given the difficulty of discerning the value of bitcoin, much of its price is affected by the opinions of high profile investors. This has come from the likes of Warren Buffet(“That is not investing”), Charlie Munger (“disgusting… stupid… turds”) and Jamie Dimon, CEO of JPMorganChase(“fraud… worse than tulip bulbs”). However, since the 2018 crash, Bitcoin has seen a surge of Institutional support from major hedge funds and CEOs around the world. In a surprising turn of events, JPMorgan reversed its views on Bitcoin in an article from its Global Markets Strategy Division:

The potential long-term upside for bitcoin is considerable as it competes more intensely with gold as an ‘alternative’ currency we believe, given that Millennials would become over time a more important component of investors’ universe… Mechnically, the market cap of bitcoin would have to rise 10 times from here to match the total private sector investment ...
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Bitcoin Optech Newsletter #132

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