Is Bitcoin Dying As A Payment Option?

Authored by Darryn Pollock via CoinTelegraph.com,

About six months ago the news was littered with companies that were looking to integrate Bitcoin as a payment system. However, in the fast-paced cryptocurrency ecosystem, things have changed dramatically.

 

https://www.zerohedge.com/sites/default/files/inline-images/20180111_coin.jpg

Now, there is a host of companies either turning away from Bitcoin or doing a full U-turn. Microsoft recently announced that after almost three years it would stop accepting Bitcoin. However, it did reserve that position after taking its own steps to: “ensure lower Bitcoin amounts would be redeemable by customers.”

Steam, the gaming platform, also canceled its use of Bitcoin as a payment system in early December last year. Their reasons resonated with the general consensus, citing high fees and incredible volatility as the main issues.

It is not only those outside of the crypto market though; The North American Bitcoin Conference set to be held in Miami next week, is no longer taking Bitcoin for last-minute tickets.

Slow and expensive

It has been a bone of contention with Bitcoin since its fees started averaging about $2, now with transactions costing upwards of $20, people have started looking at Bitcoin as something other than a digital currency.

The North American Bitcoin Conference said on its website that network congestion and manual processing influenced the decision to stop accepting payments in cryptocurrencies.

"We have, and always will, accept cryptocurrencies for our conferences, up to fourteen days before the event," the organizers wrote.

"However, due to the manual inputting of data in our ticketing platforms when paid in cryptocurrencies, we decided to shut down Bitcoin payments for last minute sales due to print deadlines."

Digital Gold

It would seem that it is possible to link Bitcoin’s change in categorization back to when SegWit2x failed to launch and thus sent Bitcoin on a monster rally that saw it end the year 13 times stronger than when it started.

Bitcoin was having problems defining itself as a digital currency, or as digital gold, and due to the nature of the cryptocurrency, it was defined democratically as SegWit2x was not taken up - for a number of reasons.

It was thought that SegWit2x would help lower costs and speed up the network; however, Bitcoin’s value as a store of value would probably take a hit.

And, with interest in Bitcoin being driven by the mainstream acceptance of the digital currency to be an asset that grew exponentially, it seemed that the community was keen to see it move towards being so-called digital gold.

Not permanent

The very fluid nature of Bitcoin’s evolution means that it could still become a very useful and viable currency if the community decides. The latest change that could be on the cards is the Lightning Network which would help hugely with Bitcoin scaling issue.

The Lightning Network would implement a smart contract script into the Bitcoin network that would open private payment channels between a peer and all of the other peers they transact with. In addition to all the private payment channels they are a part of, each of peer would have one channel open to the Bitcoin Blockchain.

Comments

TruthHammer bshirley1968 Fri, 01/12/2018 - 15:07 Permalink

BitCoin is a commodity, not a currency, no matter how angry millennials get...

It will never be a significant portion of economic activity in any region, area, country, or the world.

If it ever starting approaching such status (it wont), it would be immediately banned, regulated, or replaced with guvCoin.

 

And for the billionth time, it doesnt matter what "tech" gets put into "crypto-currencies", the governments still control YOU, the INTERNET, all BUSINESSES, and every medium of communication. 

BitCoin will never be a currency and will only be free of the GUV as long as it stays inconsequential to world economic activity...

In reply to by bshirley1968

Stackers Brazen Heist Fri, 01/12/2018 - 15:22 Permalink

Something like Lightning Network is what I always predicted about Bitcoin.

It's not BTC itself that will allow mass adoption, but the system(s) that will be built on top of it that no one has thought of yet

BTC is not money for the internet. It is the internet of money. And much like the internet it is only useful as the systems and function designed to run on and use it. BTC still waiting for it's "browser" to be invented, and it's "cloud storage", and all the other 10 bazillion things the internet is used for today that no one dreamed of in 1995 when everyone was running Windows95 on their PC

In reply to by Brazen Heist

auricle bshirley1968 Fri, 01/12/2018 - 17:57 Permalink

Has anyone called Satoshi and asked him how to resolve the scaling issues? The lighting network is patchwork by abstraction for the major flaw that the underlying blockchain is not scalable and cannot handle many transactions per second. I would say Ethereum is better than Bitcoin on lightning network. 

In reply to by bshirley1968

DaveA auricle Fri, 01/12/2018 - 19:12 Permalink

Yes, years ago he was asked about this, and Satoshi said that network bandwidth would always grow faster than Bitcoin traffic, so don't worry. Makes you wonder, when standard home internet is fast enough to stream six HD movies at the same time, who's going to pay for an upgrade just to use Bitcoin?

The one-megabyte block size limit was a temporary hack that became permanent because miners see no reason to increase it. As a San Francisco landlord would say, why permit more housing in the city when I can just raise rents on the housing I already own?

In reply to by auricle

Rickety Rekt Dickweed Wang Fri, 01/12/2018 - 15:22 Permalink

Yeah try and pay with a silver coin and a store owner will gladly tell you to fk off.

STILL HAVE TO CONVERT TO THE FIAT OF YOUR CHOICE

That said I still have my PMs and recently bought some Junior miners for some torque.

 

Actual currency coins like LTC will go the distance, and I agree that BTC won't be used as a big transaction currency.

 

Teams have also been developing payment cars that are linked to currency and just exchange at the current rate, like when you are in another country and take out money. Loaf wallet works for LTC - can literally buy anything where you can scan a phone to pay. 

In reply to by Dickweed Wang

Maghreb MagicHandPuppet Fri, 01/12/2018 - 17:44 Permalink

Not really Magic Hand Puppet. At 12k a coin it perfectly reflects the amount of capital needed to buy an 8 year old girl from the Philippines , Indonesia, Uttar Pradesh or an entire family of subsistence farmers in Sub Saharan Africa. These things are highly in keeping with its origins as a currency for nerds and its massive increase in value based on nothing but madness and sociopathic behaviour.  

Silk Road was just when they were selling drugs and weapons when it was like 400$ a coin. Pretty sure bit coin is now the currency for illegal organ trafficking, sex slavery and covert weapons of mass destruction research. As it becomes more traceable less secure it only makes sense if the values of the dodgy shit traded on it goes up and with it the value of the currency. Its about right to the currency backing the illegal shrunken virgin heads and pineal gland trades now.

Still not the worst thing in the world.Pretty sure U.S bonds are now exchangeable with human souls........

In reply to by MagicHandPuppet

Buckaroo Banzai So Close Fri, 01/12/2018 - 14:33 Permalink

"Trying buying a cup of coffee with a 10 yr."

Or with a gold coin, for that matter.

Like gold, Bitcoin has turned into a settlement vehicle and store of wealth. People who think that Bitcoin giving up its transactional use case is a defeat for Bitcoin are short-bus retarded. It has ascended to a higher level.

Right now, a number of other coins are competing to become the premiere transactional cryptocurrency-- or transactional cryptocurrencies, plural. There is no monetary law that dictates that only one currency must "rule them all". We are transitioning to a new world where dozens of currencies can operate side by side. Atomic swaps and sidechain technologies will facilitate this tremendously. It will take a couple of years to all shake out. In the meantime, infrastructure is being built. Cryptocurrencies right now are like the internet was in 1995--breaking out into the public consciousness, establishing its bona fides, and figuring out how to integrate itself with the world at large. Get ready for the future.

In reply to by So Close

Dickweed Wang T-NUTZ Fri, 01/12/2018 - 15:03 Permalink

You want to see the future Nutz?  Here ya go:

Today, a little over two years later, the US Treasury has figured this out, and on Friday Treasury Secretary Steven Mnuchin said he will work with the Group of 20 nations to prevent cryptocurrencies such as bitcoin from becoming the digital equivalent of an anonymous Swiss bank account.

"We are very focused on cryptocurrencies," Mnuchin explained, pointing to discussions with other regulators within the U.S. government and later stating: "We want to make sure that bad people cannot use these currencies to do bad things."

In reply to by T-NUTZ

JohninMK Dickweed Wang Fri, 01/12/2018 - 16:04 Permalink

That's a pretty tough plan.

First thing to expect the governments as a pack can do is to turn cryptos into primarily a transaction tool. To achieve this they will need to eliminate as far as possible the huge swings in value or high valuations.

They are likely to try and do this by eliminating the capital gain potential with the imposition of heavy, perhaps 80% or more, capital gains taxes on short or long term gains. This should cause the number of speculators and prices to drop dramatically.

This would then make their objective a bit more manageable.

In reply to by Dickweed Wang