Gabe Newell: Bitcoin on Steam is Unlikely and Here's Why

Posted in: Archive
March 6, 2014 10:32 AM UTC

On Tuesday, the 5th of March, Gabe Newell, Valve ‘s co-founder and managing director of video game development, participated with other video game developers in a reddit AMA (Ask Me Anything). The post, titled “WeAreA videogame developer AUA!“, currently has 3,469 points with 34,503 upvotes (the downvotes are probably gamers upset over the absence of any news on Half-Life 3). The answered questions dealt with various things like new Valve hardware, Gabe’s favourite non-Valve game (Mario 64), etc.

Q: GabeN, what are your specs?
A: Well, I’m a handsome man with a charming personality.
link to comment’s thread

However, one redditor, platonicplates, asked about the possibility Valve accepting Bitcoin on Steam.

Q: If there was enough community interest, would Valve accept crypto-currency such as dogecoin or bitcoin on Steam?
A: There are two related issues: one is treating a crypto-currency as another currency type that we support and the broader issue is monetary behaviors of game economies. The first issue is more about crypto-currencies stabilizing as mediums of account.
link to comment’s thread

It looks like Newell, (GabeNewellBellevue on reddit), isn’t too eager to accept Bitcoin as a form of payment on Steam. The gaming platform and online store currently only accepts traditional forms of digital payment such as credit card and PayPal. Due to Gabe’s issues such as cryptocurrencies’ volatility, Steam is unlikely to add online currencies such as Bitcoin and Litecoin as methods of payment.

Steam currently only accepts traditional forms of digital payment such as credit card and PayPal.

Gabe Newell Knows What He’s Talking About

While it may seem easy to dismiss Valve as another company lagging behind Bitcoin adoption and not understanding how cryptocurrencies work, this may not be the case. First of all, Valve is a hugely successful corporation, worth about $3 billion. Furthermore, Newell and company know how to work in the gaming economy. Unlike other gaming corporations like EA, Valve often has huge sales, free DLC (downloadable in-game content), and more. And while it may seem like this would result in a decrease in profit, the exact opposite seems to be true.

“The sale is a highly promoted event… We do a 75 percent price reduction…what we saw was our gross revenue increased by a factor of 40. Not 40 percent, but a factor of 40. Which is completely not predicted by our previous experience with silent price variation.”
-Gabe Newell

Valve actually makes more money by selling their games for less. Furthermore, a few years ago the company made Team Fortress 2 permanently free, a highly popular game that used to cost $20. Instead of seeing a decrease in annual profit, Valve once again saw an increase with new players spending hundreds of dollars on in-game items such as weapons and hats.

Valve earns millions of dollars in revenue from players purchasing…hats.

Additionally, Valve doesn’t pester users with anti-piracy technologies like DRM, and instead focuses on offering a great service.

“The easiest way to stop piracy is not by putting antipiracy technology to work. It’s by giving those people a service that’s better than what they’re receiving from the pirates.”
-Gabe Newell

All things considered, it’s clear that Valve knows how to make a ton of money in novel, unique ways. As such, if Gabe Newell doesn’t think that supporting cryptocurrencies on Steam is such a good idea, perhaps it really isn’t.


“In the Meantime…”

“In the meantime…”

In the meantime, for gamers looking to use Bitcoin with Steam, there are still a couple of options. Websites such as SteamBits offer Steam games for sale in Bitcoin. Another site, Steam Loader, allows users to purchase Steam gift card codes in BTC. Furthermore, the Humble Indie Bundle often offers pay-what-you want indie game bundles, and Bitcoin payments are accepted. Humble Bundle also recently launched the Humble Store, which offers several indie games for sale (with Steam keys and Bitcoin payments, of course).
Bitcoin is still an incredibly volatile currency that most of the world doesn’t entirely understand. But while it seems unlikely that Steam will support Bitcoin payments in the near future, gamers still have several options.
(By the way, that’s a Half-Life 2 reference above, in case you missed it.)
Images from Half-Life Wiki, the Official Team Fortress Wiki, and EDGE-online.

Last modified: June 10, 2020 5:20 PM UTC

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Neil Sardesai @neilsardesai

I enjoy keeping up with the latest stuff in science and technology and have been following Bitcoin for a few years now. I also occasionally post cool stuff on twitter.