[2019-02-26] Bitcoin Surpasses PayPal in Yearly Transaction Volume at $1.3 Tn

[tyz]

Bitcoin Surpasses PayPal in Yearly Transaction Volume at $1.3 Trillion

Per the data collected from global statistics portals, the Bitcoin network posted $1.3 trillion worth of transactional volume in 2018. Within the same timeframe, PayPal recorded $578.65 billion worth of payment transactions. It was the second time in a row Bitcoin outran PayPal.

https://www.newsbtc.com/2019/02/26/bitcoin-surpasses-paypal-in-yearly-transaction-volume-at-1-3-trillion/

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[DooMAD]

Would the headline not be clearer as "Yearly Transaction Value", rather than "Volume"?  On-chain, at least, Bitcoin clearly handles a smaller number of transactions compared to PayPal.  But the BTC transactions are worth more in USD.  Which is mainly the result of BTC's dollar price rising over the years.  Throughput is increasing on-chain with more companies batching transactions and SegWit seeing wider usage now, but it's still difficult to see things in context if the natural growth is distorted by fiat price swings in this graph.  At the very least, it should be accompanied by a second graph purely showing the number of transactions.

As a hypothetical example, if Bitcoin somehow happens to carry an identical number of transactions in 2019 as it did in 2018 and the price rises again this year, that graph would still look more favourable next year, even without an increase in actual throughput.

[Carlton Banks]

On-chain, at least, Bitcoin clearly handles a smaller number of transactions compared to PayPal.  But the BTC transactions are worth more in USD.  Which is mainly the result of BTC's dollar price rising over the years. Throughput is increasing on-chain with more companies batching transactions

To me, that's a list of significant reasons why comparing Bitcoin's transaction volume to Paypal's isn't particularly meaningful; Paypal doesn't have at all the same technological challenges in handling high transaction volumes, as it's a mature centralised network. Lightning has the potential to surpass Paypal's tx throughput, but we'll never have actual measurements as to whether that's happening in practice, because of the private nature of the payment channels on Lightning.

So this metric is at least something we can make definitive statements about, and it's very positive for Bitcoin's outlook.

[gentlemand]

Would the headline not be clearer as "Yearly Transaction Value",

I wouldn't have bothered writing the headline in the first place.

They seem to be counting a coin movement as the same as someone paying or being paid for something with Paypal. Coins move all the time with no intention of paying for anything or having been bought or sold. You don't move your dollars from Paypal account to Paypal account.

I wish they'd give up on these pointless and empty comparisons.

[BitHodler]

but we'll never have actual measurements as to whether that's happening in practice, because of the private nature of the payment channels on Lightning.

That's what I like about it, people continuously complain about Bitcoin's lack of privacy, but they forget that LN does offer them that, or at least, way more so than regular on-chain transactions.

Overall, it shouldn't come as a surprise that most of what Bitcoin pumps through on-chain is related to speculation, but no matter how you look at it, it's still a form of use, and one that doesn't seem to have any limitations at all.

I would prefer it to be use in form of spending and cross-border value transfers, but it is what it is, and maybe we can't expect more than speculative use with how stability is needed to stimulate actual currency usage.

[joniboini]

I wish they'd give up on these pointless and empty comparisons.

That would never happen though. Media love stuff like this, it is interesting too (most) people because they want to hear that Bitcoin can beat Visa (or vice versa). As long as there are people who read things like this, a comparison like this will continue to exist.

That's what I like about it, people continuously complain about Bitcoin's lack of privacy, but they forget that LN does offer them that, or at least, way more so than regular on-chain transactions.

Because LN is not easy to understand or use atm, so most people just shrug off the idea. It might take a while before LN becomes a common thing.

[btyco]

If you can't beat them, join them. Time for paypal to start accepting bitcoin and altcoins, otherwise it will lose it's dominance for online payments. Especially when LN begins to roll out fully

[buwaytress]

Would the headline not be clearer as "Yearly Transaction Value",

I wouldn't have bothered writing the headline in the first place.

They seem to be counting a coin movement as the same as someone paying or being paid for something with Paypal. Coins move all the time with no intention of paying for anything or having been bought or sold. You don't move your dollars from Paypal account to Paypal account.

I wish they'd give up on these pointless and empty comparisons.

Exactly why transaction volume or even frequency should not be confused with payments. I just looked quickly at my own transactions just on my own wallets. The majority are still payments, either receiving or sending, but you're right, just almost 10% (1 in 11 actually) of my transactions are either just moving funds around wallets or even consolidation transactions.

I probably consolidate and spring clean a bit more than normal but you'd never think to do that with Paypal (although presumably you could share and refund funds between friends and family). Visa/MC comparisons are even worse, as those are purely payments.

[1Referee]

If Jamie Dimon could jump in a shit here, it would look like; hey hey, we here at JPMorgan do $6 trillion in transfers a day, it's not done in cash, it's done digitally.

The fact that something that was nothing, still is nothing to a certain degree, allowed over $1 trillion worth of economical activity to take place, is very much indicative of its usefulness. It costs pennies to move any amount from one place to another, and that over the most powerful/secure network ever, that's a sick deal you can't say no to.

I do however understand that articles coming up with these comparisons are a bit silly. In the same way, we could switch the metric used, and point out how superior PayPal is over Bitcoin when it comes to ecommerce, because that's what people use it for +90% of the time.

[davis196]

Bitcoin Surpasses PayPal in Yearly Transaction Volume at $1.3 Trillion

Per the data collected from global statistics portals, the Bitcoin network posted $1.3 trillion worth of transactional volume in 2018. Within the same timeframe, PayPal recorded $578.65 billion worth of payment transactions. It was the second time in a row Bitcoin outran PayPal.

https://www.newsbtc.com/2019/02/26/bitcoin-surpasses-paypal-in-yearly-transaction-volume-at-1-3-trillion/

I'm not suprised.Paypal sucks anyway.It's about time to be destoryed...
By the way,the ex-founder of Paypal,Elon Musk likes bitcoin and makes compliments about how the blockchain works.This is kinda absurd to me.

[LeGaulois]

Up to 2/3 of the Bitcoin transactions have nothing to do with real usage. It's just people trades. What matter is the number of transactions from people using it as a currency, and not a trade to the moon lifestyle.
With Bitcoin, you have a group of people transacting with a lot of (money) bitcoins while with Paypal people usually do small (or medium) transactions.
So if you consider only the Bitcoin TXs from people with a real usage for sure Bitcoin is small compared to Paypal

[magneto]

They seem to be counting a coin movement as the same as someone paying or being paid for something with Paypal. Coins move all the time with no intention of paying for anything or having been bought or sold. You don't move your dollars from Paypal account to Paypal account.

I wish they'd give up on these pointless and empty comparisons.

Exactly. The fact that change addresses are so commonly used in bitcoin should be an indicator of how much "duplicate" transaction volume is being accounted for here.

Real capital movement is probably significantly less than what the estimates are, because if you are counting every single on chain transaction, you are not going to get an accurate figure whatsoever. And it's incomparable to paypal simply because the nature of the two are completely different, as well as the way they operate to facilitate transactions.

Even looking amount of people using bitcoin vs. the amount of people using paypal would be a more meaningful comparison, in my opinion. Because it is clear to me that even though I think bitcoin has way more potential than centralised payment protocols will ever have, at the moment, adoption of BTC is significantly lower, along with social acceptance.

[Carlton Banks]

They seem to be counting a coin movement as the same as someone paying or being paid for something with Paypal. Coins move all the time with no intention of paying for anything or having been bought or sold. You don't move your dollars from Paypal account to Paypal account.

I wish they'd give up on these pointless and empty comparisons.

Exactly. The fact that change addresses are so commonly used in bitcoin should be an indicator of how much "duplicate" transaction volume is being accounted for here.

But if there's change, then that means it's not someone shuffling money around from one pocket to another, that proves they're paying someone, right?

Well, no. It's a well known fact that people try to simulate real commerce by "splitting": sending 1 or more outputs to 2 addresses they control, in order to appear as though someone spent some money and received some change, and so now 2 people own the money that was used as the input to that transaction. There are techniques to analyse this kind of behaviour, but it's all probabilistic stuff. And there are various way to defeat that kind of analysis anyway.

So second guessing how the money is being used carries no certainty, as people are already camouflaging 1 form of behaviour as another on the blockchain. Here's a certainty; whatever the reason for the movement, this article claims 1.3 trillion was moved in 2018. And everyone who moved that BTC wanted to pay the fees to move it.