Pantera Capital has published a report on the impact that the entry of big players such as PayPal into the cryptocurrency market has had. The investment firm claims that PayPal buys 70% of Bitcoin supply issued to meet demand of its users in crypto service which includes ETH, LTC, BCH for buying and trading. As a result, Bitcoin’s price has received a positive boost.

At the time of writing, Bitcoin traded at $18,532 with a 2.79% gain in the last 24 hours. In the weekly and monthly charts, the earnings are 13.98% and 55.68% respectively. In terms of market cap, Bitcoin has reached a new all-time high with $350 billion surpassing, as celebrated in the cryptocurrency community, Mastercard.

The recent rally, says Pantera Capital, indicates signs of being more “sustainable” than in 2017 by relying on institutional adoption. So, it could go beyond a new all-time high in the price of BTC. The investment firm has claimed that together PayPal with 70% and Square with 40%, buys more than the supply produced by BTC. They do this by increasing their offer for each Bitcoin.

Due to the requirements of the Bitlicense that PayPal has acquired from the state of New York, the company has to maintain “real Bitcoin” at a 1-to-1 parity for each unit bought by its users. As indicated by Pantera Capital, PayPal’s users are estimated at 300 million. In comparison, Bitcoin has about 100 million users.

Currently, only eligible PayPal users in the United States are eligible to use the crypto service that includes EthereumLitecoin and Bitcoin Cash for buying and trading. However, the company aims to expand its service for international customers in 2021. This could continue to increase buying pressure from BTC. Pantera Capital estimated:

“That is THE story in Bitcoin right now. When other, larger financial institutions follow their lead, the supply scarcity will become even more imbalanced. The only way supply and demand equilibrates is at a higher price.”

Bitcoin becomes scarcer as companies accumulate

The data speaks for itself; Bitcoin’s rally has been driven by companies and institutions that have entered a state of “frenzy” to acquire BTC. Bitcointresuries data shared by investor Clark Moody shows that currently the companies that have bought Bitcoin, like Galaxy Digital Holdings and MicroStrategy, have an estimated $15 billion accumulated. This shows 842,229 BTC or 4.54% of the total BTC supply.

According to data from the BTC-based financial derivatives platform, Deribit, Three Arrows Capital’s CEO, Su Zhu sets a new target price for the cryptocurrency at $36,000. Zhu said open interest in the platform is at an all-time high.