Irish online payment processor Stripe announced Tuesday it will discontinue accepting bitcoin payments as of April 23, 2018. The company cites block size capacity, slow transaction confirmation times and high fees as the reasons behind the change. Stripe became the first major processor to accept bitcoin back in 2014.
Company product manager Tom Karlo goes on to mention that the company will continue to keep a close eye on emerging coins and platforms that may make doing business on blockchains viable again. He specifically mentions Bitcoin’s Lightning Network, Ethereum, and OmiseGO as promising projects.
Tom Karlo explained the reasons for the volte-face:
“Our hope was that Bitcoin could become a universal, decentralized substrate for online transactions and help our customers enable buyers in places that had less credit card penetration or use cases where credit card fees were prohibitive. Over the past year or two, as block size limits have been reached, Bitcoin has evolved to become better-suited to being an asset than being a means of exchange.”
Karlo points to bitcoin’s current volatility, noting that by the time a transaction has been confirmed, BTC’s USD value has already changed, often discernibly. This is coupled with the fact that “For a regular bitcoin transaction, a fee of tens of U.S. dollars is common, making bitcoin transactions about as expensive as bank wires.”
Back in 2014, Stripe had written that “Bitcoin has huge potential as a way to transport value. It’s surprisingly difficult to move money today, and the experience of paying for something online is just about the only part of the internet that hasn’t changed dramatically in the past twenty years….we can already start to see the shape of the potential impact of Bitcoin and other cryptocurrencies. If we get things right, life is going to be much better for billions of people.”
Leaving the party
Late last year, Bloomberg revealed that of the top 500 companies in the world, only three were accepting bitcoin as payment.
Issues with scaling, transaction times and fees don’t just affect retail businesses. Altcoins are also backing off of the bitcoin network. Storj, a blockchain-based cloud storage coin, announced last spring that they would be moving to the Ethereum blockchain. The value of their token went up 400% shortly after migrating.
It’s becoming more and more clear that if Bitcoin wants to keep the top spot as the world’s most valuable cryptocurrency, something’s got to give. The fact is it’s no longer regarded as an easy way to pay for things. It has been more digital gold than digital cash for a long time now.
The fear of increased government regulation and the proliferation of pyramid schemes are certainly to blame for the recent plummeting of cryptocurrency valuations. That said, until proper scaling and interoperability solutions are put in place, bitcoin and its companions may eventually end up collecting dust in your digital coin collection.
That’s an opinion shared by many in the space, including Bitcoin Jesus himself, early adopter and influencer Roger Ver. Ver backs Bitcoin Cash as the future king of crypto. He believes it’s a much cheaper and faster alternative to Bitcoin and that businesses will be much more likely to adopt it as the go-to payment option.