Stripe, the fast-growing online payments firm established by Limerick brothers Patrick and John Collison has ended support for bitcoin payments. Digital currencies hold the promise of handling transactions quickly, securely and inexpensively, making them a technology that likely will transform mobile payments dramatically in the coming years.
Payment processing company Stripe announced this week that it will no longer accept Bitcoin as a payment method on its platform, citing the currency's volatility, slow transaction times and ever-increasing processing fees.
"For a regular Bitcoin transaction, a fee of tens of USA dollars is common, making Bitcoin transactions about as expensive as bank wires", explained Karlo. Stripe customers who accept bitcoin have seen their revenues from the cryptocurrency decline substantially, removing incentives to accept it.
We have seen a considerable increase in the value of Bitcoin over the past year, this has lead to high transaction charges.
Stripe was one of the first payments companies to throw its weight behind bitcoin, introducing transactions in the virtual currency in early 2015. Microsoft also rattled the markets when it briefly stopped taking bitcoin payments.
Stripe first enabled bitcoin transactions in 2015.
The company - which operates in 25 countries, including Australia - said it would "stop processing Bitcoin transactions on April 23" this year. This then means it has considerable influence on people's perceptions, remember, the success or failure of Bitcoin (and all cryptocurrencies) is highly dependent on the people's perception. Separately, Stripe said Bitcoin users now saw the virtual currency largely as an "asset" to be bought and sold, rather than something a means of exchange.
"There are fewer and fewer use cases for which accepting or paying with bitcoin makes sense", said Tom Karlo, Stripe's product manager.
Therefore, starting [January 23rd], we are winding down support for Bitcoin payments.
Indeed, blockchain data shows that as cryptocurrency has become more popular, confirmation times have gotten longer and transaction fees have increased-according to Ars Technica, fees peaked at $34 last month. 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.