Steam Just Dropped Bitcoin Support, Saying It's Just Too Damn Volatile
How big a red flag is this for the cryptocurrency?
Two of the hardcore internet’s faves just broke up — and it’s a little messy. Steam announced Wednesday afternoon that it will no longer accept bitcoin as a payment option.
The internet’s biggest game distribution platform and marketplace is easily the most high-profile site to drop support for the blockchain-based cryptocurrency. It’s a blow for bitcoin for two reasons. First, if there’s any big site on the internet that should always be bitcoin-friendly, you would think it would be Steam. And second, Steam and its parent company Valve went all the way in on bitcoin in making the announcement, blasting it for its ever-increasing price volatility.
At the root of the problem, according to Steam, are the transaction fees for using bitcoin, which the site says have increased from 20 cents when Steam first started accepting the cryptocurrency to $20 as of last week.
That’s only part of the problem, however, as the real issue is that bitcoin’s value goes up or down so fast it’s often not possible to complete a transaction before the actual amount of money the user spent has changed so much that either they now need to pay more or Steam has to issue a refund.
“In both these cases, the user is hit with the Bitcoin network transaction fee again,” the Steam Team explained in their announcement. “This year, we’ve seen increasing number of customers get into this state. With the transaction fee being so high right now, it is not feasible to refund or ask the customer to transfer the missing balance (which itself runs the risk of underpayment again, depending on how much the value of Bitcoin changes while the Bitcoin network processes the additional transfer).”
From an investment perspective, bitcoin’s seemingly never-ending surge is incredibly exciting, with the cryptocurrency most recently hitting $13,000 in value less than 24 hours after breaking the $12,000 barrier. But those big increases — to say nothing of last week’s unexpected drop, when bitcoin lost about a fifth of its value basically out of nowhere — has started to make the cryptocurrency a real pain for sites where people want to use it as, well, a currency. On that front, Steam’s conclusion is damning in just how direct it is.
“At this point, it has become untenable to support Bitcoin as a payment option,” the team said. “We may re-evaluate whether Bitcoin makes sense for us and for the Steam community at a later date.”