The founder of the crypto investment firm Ark Invest, Cathie Wood has divested all of her holdings in PayPal and has shown greater confidence in the long-term growth of the Cash App payment system, which uses the Bitcoin (BTC) Lightning Network.
Wood explained his company’s decision at the Miami Bitcoin 2022 conference, which ended on Saturday.
The Lightning Network (LN) is a layer 2 solution for Bitcoin intended to facilitate faster and cheaper transactions. Fintech company PayPal operates payment app Venmo as a direct competitor to Block’s (formerly Square) Cash App.
“@ARKInvest has sold, completely got out of Paypal, whose Venmo is a big competitor to Cash App.
(Cash App has) much more conviction – especially when it comes to bitcoin.” pic.twitter.com/mUGkdWGMFX
— Miles Suter (@milesuter) April 10, 2022
“@ARKInvest has sold its stakes in Paypal, whose Venmo company is a big competitor to Cash App. (Cash App has) a lot more conviction, especially when it comes to bitcoin.”
Wood said in an interview with CNBC on Friday that he made the decision to leave PayPal for Cash App because of its broader focus toward digital asset wallet integration. He said that while Venmo has started to accommodate Bitcoin, it “just follows what Cash App does.”
“We tend to place our bets with who we think will be the winners […] Consolidating our portfolios during a period of risk, we chose Block over PayPal.”
Wood went on to say that her firm’s conviction in Cash App stems from what she perceives as organically driven user growth. “as opposed to a more top-down approach” from Venmo.
Usually, Wood believes that retail investors have driven the crypto market up to this point, as stated:
“I don’t think most institutional investors are positioned as they ultimately will be. Retail has really led the charge here.”
Venmo currently has 70 million users and $850 million in revenue, compared to 44 million for Cash App and $2.03 billion in revenue in 2021according to data from the app tracker Business of Apps. The stark contrast in their ability to net profit could be another motivating factor for Ark’s evaluation of the two brands.
While Ark Invest has taken a bullish stance on Cash App, its Bitcoin product manager, Miles Suter announced Thursday that US users could automatically invest a
part of your direct deposits in Bitcoin.
Wood is a big believer in bitcoin, and in the interview she repeated her prediction that BTC would hit $1 million by 2030.
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