Valve closes the bitcoin valve.
Valve’s popular gaming and digital distribution platform Steam started accepting bitcoin payments back in April 2016, when the cryptocurrency was trading at about $450. The cryptocurrency’s surge seems to have made it too volatile and expensive for the platform to continue to accept it, as Valve announced on Wednesday it will no longer accept bitcoin payments.
In a blog post, the company revealed that the cryptocurrency’s fees have become too high for it to be accepted on the platform, as they lead to “unreasonably high costs for purchasing games with bitcoin.” The company’s blog post reads:
In the past few months we’ve seen an increase in the volatility in the value of Bitcoin and a significant increase in the fees to process transactions on the Bitcoin network. For example, transaction fees that are charged to the customer by the Bitcoin network have skyrocketed this year, topping out at close to $20 a transaction last week (compared to roughly $0.20 when we initially enabled Bitcoin). Unfortunately, Valve has no control over the amount of the fee.
Although most bitcoiners are well aware of how the network works, Steam is also worried about its volatility. Since the cryptocurrency’s value keeps rapidly changing, and the amount of bitcoin used to purchase a game is only guaranteed by the marketplace for a limited period of time, if the customer doesn’t finish the purchase during that period, the amount of bitcoin needed to purchase the game can then be significantly different.
Steam’s blog post adds that the platform usually solved the problem by either refunding users, or asking them to transfer additional funds to cover the remaining balance. The solution is no longer feasible, as additional transactions incur more costly transaction fees, and may not immediately solve the problem as bitcoin’s value could keep on fluctuating.
For these reasons, Steam’s post ends stating that “at this point, it has become untenable to support bitcoin as a payment option.” The company adds that it may re-evaluate if accepting the cryptocurrency makes sense at a later date.
Valve’s announcement comes at a time in which bitcoin hits a new all-time high above $15,300, as the cryptocurrency’s market cap recently surged past the $250 billion mark. In terms of usability, however, the cryptocurrency has seen better days, as according to Blockchain.info there are over 140,000 unconfirmed transactions, meaning the mempool is above the 110 million byte mark.
The cryptocurrency may be going through a hard time, but the long wait for the Lightning Network may now be close to over, as recently startups behind the three most active Lightning implementations revealed tests results that include live transactions.
Various cryptocurrency enthusiasts attempted to get Valve to consider accepting other cryptocurrencies as an alternative to bitcoin. Among various suggestions, users pointed to Dash, Litecoin, Ethereum, and IOTA.
Prominent Bitcoin Cash (BCH) supporter and Bitcoin.com CEO Roger Ver saw the announcement as an opportunity to increase Bitcoin Cash’s adoption, and as such publicly invited the company to accept the cryptocurrency.
Featured image from Shutterstock.
Last modified: May 20, 2020 9:17 PM UTC