PayPal’s recent leap into the crypto market is helping to drive the current bitcoin (BTC) rally, according to Pantera, a prominent cryptocurrency and blockchain investment firm.

In an investor letter published Nov. 20, the venture firm compared the ongoing bull market to the last time BTC rose above $18,000, three years ago. 

“Previously the friction to buy bitcoin was pretty onerous,” the letter notes, contrasting that difficulty with how e-commerce giant PayPal has now made it easy for millions of users to become potential bitcoin, ether, bitcoin cash and litecoin buyers. 

Indeed, all eligible PayPal account holders in the U.S. can now buy, hold and sell those cryptocurrencies – sooner than the payments firm anticipated, due to steep customer interest. Additionally, the firm recently upped its weekly crypto purchase limits to $20,000 from an initial $10,000. 

“BOOM! The results are already apparent,” Dan Pantera, chief executive and founder of the eponymous fund, wrote in the November letter. “When PayPal went live, volume started exploding.”

Panterra claims that PayPal is already buying almost 70% of the new supply of bitcoins. Together with Square’s Cash App routine bitcoin buying, more than 100% of all newly minted bitcoins is accounted for, Panterra alleges.

The Bitcoin network issues new BTC on a fixed and predetermined schedule. Only 6.25 new BTCs are mined every 10 minutes, following this year’s “halving,” an amount that will continue to decrease every four years until all 21 million BTC enter circulation.

Panterra’s thesis centers around a supply-side understanding of the bitcoin market. The idea is that as the supply of BTC decreases, due to lower mining rewards, the demand naturally increases – leading to an appreciation in price

“When other, larger financial institutions follow [PayPal’s] lead, the supply scarcity will become even more imbalanced. The only way supply and demand equilibrates is at a higher price,” Panterra wrote.

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