Steam dumps Bitcoin on back of high transaction fees and volatility

Federico Mansilla
Diciembre 7, 2017

Valve, the company that owns Steam, noted the value for Bitcoin only stays stable for a certain period of time and can change before a transaction has been completed.

"...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)", Steam said in its blog post. With Valve unable to control these blockchain-linked costs (passed on from third-party Bitpay), the company anxious that it was leading to "unreasonably high costs for purchasing games when paying with Bitcoin" (though apparently these are costs Bitcoin users as a whole have been willing to shoulder of late).

Valve went on to explain that due to the volatility in the value of Bitcoin, there could be a significant difference in the amount that was paid by the consumer and the amount that will reach the company since it takes time to process transactions. Regarding the fees, Valve pointed out that the transaction fee charged to the customer using Bitcoin rose from 20 cents when Valve started accepting it to nearly $20 today. Valve initially joined in on the action previous year when it started accepting bitcoin for purchases on its PC gaming store, Steam. Its volatility and transaction costs are a common sticking point for those looking to use it as a currency, yet the possible solutions to these pitfalls could imperil the decentralization that makes bitcoin appealing in the first place.

Bitcoin valuation has become a problem recently as well, as the value fluctuates wildly over very short spans of time.

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For these reasons and the overall volatility of the currency, it's "untenable" to support Bitcoin at the moment, the blog said.

So, even though this may be the end of Bitcoin support through Steam for now, this may not be a permanent change.

Many organizations are still reluctant to trust blockchain technology, however others have found good use cases for it apart from Bitcoin. Valve says that the company may "re-evaluate whether Bitcoin makes sense for us and for the Steam community at a later date [,]" but now Valve is mostly trying to resolve pending issues with customers impacted by Bitcoins' flux. This in turn runs the risk of under/overpayment again should the value of Bitcoin change and can result in yet another transaction needing to be performed.

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