Bitcoin surpasses PayPal in value transferred

Since the start of 2021, the Bitcoin network has processed a greater volume of transactions in US dollars than the PayPal payment system, according to a Blockdata report.

The quarterly average for the decentralized network stood at $489 billion, compared with $302 billion for PayPal.

Both figures fall well short of the quarterly averages of giants Mastercard and Visa, at $1.8 trillion and $3.2 trillion, respectively.

“It is impressive how Bitcoin, being a 12-year-old P2P network, has 27% on one metric (value processed) compared with Mastercard — a company founded in 1966. Especially considering that this is a decentralized movement,” Blockdata analysts noted.

They acknowledged that the network’s metric includes more than payments. Users send funds to various services and receive them back, make transactions between their own wallets, and a number of other operations.

However, in their view, the Bitcoin network is “fundamentally” different from Mastercard and Visa. It is more of a “saving technology” than “spending” and has more use cases.

Experts consider it plausible that the cryptocurrency could surpass financial giants in transfer-value volumes, despite a significant lag. To do so, it is necessary to close the bandwidth gap, which they described as “staggering.”

Last year, the Bitcoin network processed an average of 25 million transactions per quarter. Mastercard’s figure stood at 33 billion, and Visa at 53.7 billion.

Experts emphasized that this problem is to be solved by second-layer solutions, including the micropayments Lightning Network (LN).

“All publicly available statistics, such as the number of LN nodes, the number of channels and BTC in them is growing exponentially. If this continues for the next several decades, it is quite possible that the Bitcoin network will process more transactions than some other financial systems,” Blockdata emphasized.

Blockstream’s chief strategy officer Samson Mow defined the theoretical throughput of LN at 40 million TPS, meaning 57.6 billion transactions per day.

According to Arcane Research analysts, by 2030 the number of protocol users could exceed $700 million.

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