The difficulty of bitcoin mining has dropped to its lowest since 2011, and PayPal has reported high demand for cryptocurrency
PayPal: demand for cryptocurrency exceeded expectations by 2–3 times
The PayPal payment system reported an increased demand for a cryptocurrency exchange service.
In October, the company added an option to buy, sell and store cryptocurrency in its wallet. At the moment, the functionality is available to 10% of PayPal users in the United States, by December the coverage is planned to increase to 100%
Dan Shulman, CEO of the company, said that the number of applications for using the new service exceeded expectations by 2–3 times. In response, PayPal has increased its weekly cryptocurrency purchase limit from $10,000 to $15,000.
“We’re seeing people who have already bought crypto open their wallet several times a day to check out what’s happening with their crypto investments,” Shulman said.
The payment system currently supports Bitcoin, Ethereum, Litecoin, and Bitcoin Cash. In the future, the list of cryptocurrencies will expand, and digital currencies of central banks may also be included in it. In the first quarter of 2021, the crypto service will become available to PayPal customers around the world via the Venmo app.
Bitcoin mining difficulty has dropped to a record level since 2011
Bitcoin recorded its largest difficulty drop in 9 years.
The indicator fell 16% on Tuesday, according to the data of the resource BTC.com. This was the second largest decline in the history of Bitcoin. In 2011 alone, the difficulty fell more significantly — by 18%.
The difficulty is automatically recalculated every 2016 blocks so that the block time is 10 minutes. The drop happened against the background of a decrease in the network hash rate. This is partly due to the end of the rainy season in China’s Sichuan province, which forced miners to move equipment to regions with cheaper electricity.
Expected volatility in BTC price rises amid US elections
The monthly expected volatility of the bitcoin rate reached a two-week high of 59%.
The indicator shows investors’ expectations regarding price fluctuations in the next four weeks. The increase may be due to the fact that market participants are afraid of challenging the results of the US presidential election. This will lead to political and economic uncertainty, which may cause fluctuations in the prices of exchange-traded assets.
Although the expected monthly volatility has increased, the half-year figure remains unchanged at around 60%. This suggests that the market does not expect a long period of political uncertainty in the US.