Stripe, the San Francisco based company that became the first major online payments platform to accept Bitcoin has ditched the token due to its high volatility. However, its co-founder John Collison still sees future for cryptocurrencies, Recode reported on September 17.
Giving up on Bitcoin
For years, Stripe has been synonymous in the startup world with online payments. But it wants to be known for more. However, the San Francisco-based company ditched Bitcoin as a means of payment, despite becoming one of the first major online payments platforms to accept the token.
According to a January 23 press release, the company said that Bitcoin had become a victim of its own popularity, with rises in transaction fees and decreased speed causing payments to fail.
The company stated that those circumstances lead them to believe that Bitcoin was meant to be more of an asset and less of a currency used for daily payments.
In an interview with ReCode, John Collison, Stripe’s president and co-founder, explained that processing Bitcoin payments were extremely time-consuming and that the dramatic price fluctuations made it difficult for retailers.
He added that Bitcoin’s value would move while the transaction was happening, meaning that by the time the transaction was confirmed, the fee was charged for the ‘wrong amount’.
John Collison (Source: EneNaija)
A Future in Crypto
Despite the issues with bitcoin, Collison told Recode that Stripe is open to processing other types of cryptocurrency payments down the line.
The problems Stripe faced with Bitcoin was not indicative of what would happen with all cryptocurrencies, he explained.
During the interview, Collison also stated that he sees a lot of potentials for cryptocurrencies to succeed as a payments method. He said that, contrary to popular belief, cryptocurrencies wouldn’t see the biggest rise in the United States or other countries that have well-functioning payments systems.
Instead, Collison believes that cryptocurrencies, in general, will see the biggest success in “far-flung” countries where payments infrastructures aren’t well established.
During Recode’s Code Commerce conference that took place in New York on September 17, Collison also made a separate public display of support for the crypto industry. Stripe has reportedly provided seed funding for a cryptocurrency network called Stellar, which trades a digital currency called lumens.
“The future of crypto — especially as it applies to the means of exchange — that future is undetermined,” Collison said in regards to Stripe’s plans for the future.