Bitcoin has surpassed PayPal in terms of value transferred
Since the beginning of 2021, the bitcoin network has processed a greater volume of transactions in US dollars than the payment system PayPal. This is according to a report by Blockdata.
The decentralised network averaged $489bn for the quarter, compared to PayPal's $302bn.
Both figures are well behind the average quarterly volumes of giants Mastercard and Visa with $1.8 trillion and $3.2 trillion respectively.
It's impressive how bitcoin, being a 12-year-old P2P network, has 27% in terms of one metric (processed value) compared to Mastercard, a company founded in 1966. Especially when you consider that we are talking about a decentralised movement, Blockdata noted.
They acknowledged that the cryptocurrency network's metric includes more than just payments. Users send funds to various services and receive them back, make transactions between their own wallets and a number of other transactions.
However, in their view, the bitcoin network is "fundamentally" different from Mastercard and Visa. It is more of a "savings technology" than a "spend technology" and has more options for use.
Experts believe it is realistic that the cryptocurrency will surpass the financial giants in terms of transferred value, despite the significant lag. This will require bridging the bandwidth gap, which they described as "staggering".
Last year, the bitcoin network processed an average of 25 million transactions per quarter. Mastercard had a figure of 33 billion, while Visa had 53.7 billion.
Experts stressed that second-tier solutions, including the Lightning Network (LN) micropayment network, are meant to address this problem.
All publicly available statistics such as the number of LN nodes, number of channels and BTC in them are growing at an exponential rate. If this continues over the next few decades, it is possible that the bitcoin network will process more transactions than some other financial systems, Blockdata stressed.
Blockstream chief strategy officer Samson Mou has identified a theoretical LN throughput of 40 million TPS, meaning 57.6 billion transactions per day.
Analysts at Arcane Research predict that the number of users of the protocol could exceed $700 million by 2030.