Key Takeaways:
- According to a Blockdata report, bitcoin has processed more transactions than PayPal in terms of dollar value in 2021.
- Bitcoin is currently trailing credit card companies, and the report looked into ways for the peer-to-peer (P2P) network to catch up.
According to a Blockdata report, bitcoin processed 62 % more transactions in terms of dollar value in 2021 than PayPal. The firm also looked at the amount of money that was exchanged on the Mastercard and Visa networks. Although Bitcoin is currently trailing credit card companies, the report looked into ways for the peer-to-peer (P2P) network to catch up. So far this year, Bitcoin has transacted an estimated average of $489 billion per quarter, compared to $302 billion for PayPal. On the other hand, Mastercard and Visa continue to lead the pack, with an average of $1.8 trillion and $3.2 trillion processed per quarter.
As per the report,
“It’s impressive how Bitcoin, as a 12-year-old decentralized network, is 27% of the way in terms of one metric compared to Mastercard, a company founded in 1966. Especially when you take into account that this is a decentralized movement.”
To catch up with Mastercard, Bitcoin needs to increase its dollar processing volume by 260% and 540 % to catch up with Visa. Despite these significant increases, the growing awareness and use of BTC, as well as ongoing developments in its ecosystem, may lead the P2P network to process more dollar value in the future.
The report stated that
“All of the publicly available statistics, such as the number of nodes in the Lightning Network, the number of channels between these nodes, and the amount of bitcoin in these channels, are growing at an exponential rate. Suppose they continue to do so over the next decades. In that case, the bitcoin network may process as many, or substantially more transactions than some of the other financial networks do.”
The Bitcoin network has maintained a 99.987% uptime since its inception. In that time, it has grown tremendously, to the point where it now processes billions of dollars in transactions every day. For various reasons, many people worldwide now rely on this network, which, unlike other large financial networks, is not maintained by a single company from a few locations. Individual nodes, operated by people and businesses worldwide who want to validate their transactions and strengthen the network, keep the network running.
The implementation and improvement of scaling solutions will determine Bitcoin’s ability to handle more transactions. The Lightning Network, which reached an all-time high capacity in late September 2021, is the essential solution currently in play. During the same period, the number of nodes and payment channels reached new highs. According to Arcane Research’s State of Lightning report, the Lightning Network will have 800 million users by 2030. It cited remittances, gaming, and streaming as examples of significant use cases that would help the scaling solution gain traction. With Lightning’s performance, the Bitcoin network could very well be on its way to competing with Mastercard and Visa. However, it will take some time before it comes to fruition.
