Cathie Wood, Crypto investment firm Ark Invest founder, has dumped all the company’s holdings of PayPal. On the other hand, she showed great confidence in the long-term growth of the Cash App payment network that utilizes the Bitcoin Lightning Network.
Wood explained that her Ark Invest company’s move at the Miami Bitcoin 2022 conference that wrapped up on April 9. She thinks that Venmo is just a follower of Cash App, which has generated at least double Venmo’s revenue from about half the number of users.
By description, the Lightning Network (LN) is a layer-2 solution for Bitcoin. It is designed to help in facilitating faster and cheaper transactions. Financial technology firm PayPal operates the payment app Venmo as a major and direct competitor of Block’s 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 (@milessuter) April 10, 2022
On April 8, Wood said in a CNBC interview that she made the decision to dump PayPal for Cash App since it has a more comprehensive approach toward digital asset wallet integration. She said that although Venmo has started accommodating Bitcoin, “it’s more of a follower of Cash App.”
“We tend to put our bets with who we believe will be the winners […] As we consolidated our portfolios during a risk-off period, we chose Block over PayPal.”
Wood continued to say that her Ark Invest firm’s conviction in Cash App came from what she believes to be organically-driven growth in users “as opposed to more of a top-down approach” from Venmo. Generally, Wood thinks that the retail investors have pushed the crypto market up to this point, as she said:
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“I don’t think most institutional investors are positioned the way they ultimately will be. Retail has really led the charge here.”
Ark Invest Prefer Cash App Over Venmo
Currently, Venmo boasts 70 million users and $850 million in profit, compared with Cash App’s 44 million users and $2.03 billion in profit last year, according to data from app tracker Business of Apps. The huge contrast in their ability to net profits might be another motivating factor for Ark’s assessments of these two brands.
As Ark Invest has now taken a bullish stand on Cash App, its bitcoin product lead Miles Suter said on April 7 that the American users could automatically invest some of their direct deposits into bitcoin.
Wood is a big bitcoin enthusiast and believer who reiterated her prediction in the interview that bitcoin would reach $1 million by 2030.