Payment processor Stripe has decided to dump Bitcoin for Ecommerce payments due to expense, slower processing times and currency fluctuations.
“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.”
– Tom Karlo, Stripe product manager
One of the big difficulties as block size limits are reached is that transaction confirmation times have increased and this leads to an increased failure rate. In addition, due to the time taken from initiating a payment to completion, the Bitcoin Price is so volatile that the transaction ends up being for the wrong amount.
Stripe also point out that transaction fees have risen and can be ‘tens of dollars’ making a Bitcoin transaction as expensive as a bank wire transfer.
Is this the beginning of the end for crypto-currencies in ecommerce?
Neither Bitcoin nor any other crypto-currency have ever made the jump to main stream adoption. They still have a reputation as an anonymous payment for nefarious activities, for instance when the WannaCry ransomware attack took place last year, payment in Bitcoin was demanded to unlock the victim’s computer files. It’s rare however to see a regular ecommerce site offer Bitcoin as a payment method and almost unheard of for the regular consumer to own Bitcoin or decide to use it as a payment method (Have you ever made or received regular Bitcoin payments for regular ecommerce transactions?)
“We’ve seen the desire from our customers to accept Bitcoin decrease. And of the businesses that are accepting Bitcoin on Stripe, we’ve seen their revenues from Bitcoin decline substantially. Empirically, there are fewer and fewer use cases for which accepting or paying with Bitcoin makes sense.”
– Tom Karlo, Stripe product manager
Stripe haven’t entirely closed the door on the future of crypto-currency for ecommerce payments, they cite a number of alternatives to Bitcoin which they’re monitoring including Stellar to which they provided seed funding. However they say that they’re looking for significant popularity while keeping settlement times and transaction fees very low in order for an alternative to be of interest adding “Bitcoin itself may become viable for payments again in the future”.
Over the next three months Stripe will work with users to ensure a smooth transition before they finally stop processing Bitcoin transactions on the 23rd of April 2018.
