In the Q4 2020 earning call, PayPal reported that cryptocurrency purchases helped keep its users on the platform.
In its latest investor update, the company wrote;
“Customers who purchase cryptocurrency have been logging into PayPal at a rate 2x their login frequency prior to purchasing cryptocurrency.”
Although PayPal CEO Dan Schulamt didn’t go over the specifics in terms of earnings, he said that “the volume of crypto traded on our platform greatly exceeded our expectations.”
It is enough for the company to push further. “We all know the current financial system is antiquated,” he stated, before highlighting a future in which all people had access to financial services. To support this goal, he promised that the company was “significantly investing in our new crypto, blockchain, and digital currencies business unit in order to help shape this more inclusive future.”
PayPal recorded $277 billion in total payment volume and $6.1 billion in revenue. It’s the strongest quarter as of now, although the figures for cryptocurrencies are calculated separately.
In October 2020, PayPal announced that its users would soon be able to buy Bitcoin, Bitcoin Cash, ethereum, and Litecoin from their account. The service debuted later in November.
So far, the payments network only facilitates buying, holding, and selling the said cryptocurrencies. It aims to allow users to use the cryptocurrencies in their PayPal accounts for purchases at 29 million brokers later this year. However, without the functionality, the integration has already paid dividends for PayPal, for the company holds a percentage of every cryptocurrency transaction made on the platform.
Ever since PayPal’s announcement on October 21, the price of Bitcoin has tripled from $12,221 to around $37,000. In a similar timeline, Ethereum had quadrupled from just under $400 to over $1600; Bitcoin Cash jumped from $260 to $440, and Litecoin has discreetly risen from $50 to $150.
Not only that. PayPal stock closed at $249 yesterday. Last October 20, the day before announcing the crypto integrations, it closed at $202.
Today’s earnings call was the first chance for investors and the common public to hear real numbers about the company’s crypto offerings, although the details were sparse.
ItBit has watched trading volumes rise in the last three months. Before the PayPal announcement, the exchange hadn’t logged any days over $5 million in volume. It set a new record with $242 million last January 10. It is impossible to know how much of that volume growth was connected with PayPal.
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