Online payments firm Stripe ends support for bitcoin

Stripe, the fast-growing online payments firm established by Limerick brothers Patrick and John Collison has ended support for bitcoin payments.

The move is seen as highly significant as Stripe was the first major payments company to support bitcoin back in 2014.

In a blogpost the company said bitcoin had of late become an asset to be traded rather than a means of exchange and was therefore “becoming less useful for payments.”

It said revenues from bitcoin had declined substantially recently as customers were less inclined to accept payments in the popular cryptocurrency due to huge swings in prices that made it more time consuming and expensive to process transactions.

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"There are fewer and fewer use cases for which accepting or paying with bitcoin makes sense," said Tom Karlo, Stripe's product manager.

He said that for a regular bitcoin transaction, a fee of “tens of US dollars is common”, making bitcoin transactions about as expensive as bank wires these days.

“Our hope was that bitcoin could become a universal, decentralised 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,” said Mr Karlo.

“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. Given the overall success that the bitcoin community has achieved, it’s hard to quibble with the decisions that have been made along the way,” he added.

Stripe said it was to start winding down support for bitcoin payments from now with a view to stop processing such transactions by April 23rd.

It added that it remains optimistic about cryptocurrencies and would continue to add support for them in the future.

“We’re interested in what’s happening with lightning and other proposals to enable faster payments. omiseGO is an ambitious and clever proposal; more broadly, ethereum 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,” said Mr Karlo.

“It’s possible that bitcoin vash, 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, he added.