Stripe Ditches Bitcoin Due To Slow Confirmation, Higher Fees

Jan 24, 2018 at 10:43

Online and mobile payments provider Stripe is dropping its support for Bitcoin payments but remains optimistic on altcoins.

On its website, Stripe said it is winding down it support for Bitcoin payments and will stop processing transactions using the cryptocurrency on April 23.

The company has cited long transaction confirmation and more expensive fees, which led to the decline in Bitcoin acceptance as payments and drop in customers’ revenues using Bitcoin, as reasons for this move.

Because of this, 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.

“Transaction confirmation times have risen substantially; this, in turn, has led to an increase in the failure rate of transactions denominated in fiat currencies,” it said.

Stripe said that by the time the transaction is confirmed, fluctuations in Bitcoin price mean that it’s for the ‘wrong’ amount.

“Furthermore, fees have risen a great deal. For a regular Bitcoin transaction, a fee of tens of U.S. dollars is common, making Bitcoin transactions about as expensive as bank wires,” it added.

 

More Opportunities In Altcoins

However, Stripe said it remains very optimistic about cryptocurrencies overall. “There are a lot of efforts that we view as promising and that we can certainly imagine enabling support for in the future,” it said.

The company said it is taking note of developments with Lightning Network, a decentralized network using blockchain system to enable instant payments launched at the start of 2018, and other fast payments solutions.

It also sees opportunities in OmiseGO, which is building a decentralized exchange, liquidity provider mechanism, clearinghouse messaging network, and asset-backed blockchain gateway; Ethereum, which “continues to spawn many high-potential projects.”

“We may add support for Stellar (to which we provided seed funding) if substantive use continues to grow. It’s possible that Bitcoin Cash, Litecoin , or another Bitcoin variant, will find a way to achieve significant popularity while keeping settlement times and transaction fees very low,” Stripe said.

 

Still Open To Bitcoin

Despite ending its support for Bitcoin, Stripe still sees the cryptocurrency could still be come viable for payments in the future.

“So, we will continue to pay close attention to the ecosystem and to look for opportunities to help our customers by adding support for cryptocurrencies and new distributed protocols in the future,” it said.

Stripe was the first major payments company to support Bitcoin payments in 2014.