Popular online gaming platform Steam is dropping its bitcoin payments feature, citing chronic problems with the cryptocurrency's transaction fees and volatile price.
It was in April 2016 that Steam, operated by game developer Valve, confirmed a long-rumored move by accepting bitcoin through a partnership with payment processing BitPay. At the time, the decision to take bitcoin was positioned as a way to serve emerging markets where payment options like credit cards may not be widely available.
Now, as of Dec. 6, the company will no longer accept payments in the cryptocurrency due to a mixture of high fees and volatility in the price of bitcoin. Specifically, the company pointed to elevated payment costs in recent months for its customers, who can use the Steam platform to purchase and play a variety of games.
The company explained:
"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. These fees result in unreasonably high costs for purchasing games when paying with bitcoin. The high transaction fees cause even greater problems when the value of bitcoin itself drops dramatically."
The post outlined how, in some cases, customers would send funds only to come up short due to the U.S. dollar conversion. When asked to send an additional transaction to cover the difference, that user would then be hit with another fee.
As a result, the bitcoin payment option has become "untenable" for Steam, with the company promising to "continue working to resolve any pending issues for customers who are impacted by existing underpayments or transaction fees."
At the same time, Steam suggested that it could move to accept the cryptocurrency in the future.
"We may re-evaluate whether bitcoin makes sense for us and for the Steam community at a later date," the post explained.
Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in BitPay.