Bitcoin Dropped By Payment Processor Stripe

Announcements, Blockchain, FinTech, News | January 24, 2018 By:

Mobile payment processor Stripe has announced it will be dropping its support for bitcoin in April.

Stripe is an Irish technology company that allows both private individuals and businesses to accept payments over the Internet. Stripe focuses on providing the technical, fraud prevention, and banking infrastructure required to operate on-line payment systems.

Stripe first enabled bitcoin transactions in 2015. At the time, the company believed that the original idea behind the cryptocurrency could greatly benefit Stripe users. It allowed residents from more than 60 different countries to pay merchants on Stripe’s network using bitcoin.

On Tuesday, however, product manager Tom Karlo announced that the company will be winding down support for bitcoin payments. Over the next three months the company will work with affected Stripe users to ensure a smooth transition before they stop processing bitcoin transactions on April 23.

Karlo said that over the past year or two, as block size limits have been reached, bitcoin has evolved to become better-suited to being an asset rather than being a means of exchange. This has led to bitcoin becoming less useful for payments.

“Transaction confirmation times have risen substantially; this, in turn, has led to an increase in the failure rate of transactions denominated in fiat currencies,” said Karlo. “Fees have risen a great deal. For a regular bitcoin transaction, a fee of tens of US dollars is common, making bitcoin transactions about as expensive as bank wires. 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.”

Despite dropping bitcoin as a payment option, Stripe remains “very optimistic about cryptocurrencies overall.” Karo said Stripe will continue to pay close attention to the ecosystem and to look for opportunities to help their customers by adding support for other cryptocurrencies in the future.

“We’re interested in what’s happening with Lightning and other proposals to enable faster payments,” he said. “OmiseGO is an ambitious and clever proposal; more broadly, ethereum continues to spawn many high-potential projects. We may add support for Stellar 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. Bitcoin itself may become viable for payments again in the future. And, of course, there’ll be more ideas and technologies in the years ahead.”