Your Bitcoin is no longer good on Steam


Photo: AP

Valve & # 39; s Steam, the digital distribution platform that enjoys almost monopolistic control of the entire PC gaming industry, has stopped accepting bitcoins as a form of payment due to volatility of currency and increasingly unacceptable processing fees. 19659003] In a blog post on Wednesday, Steam wrote that "In recent months we have seen an increase in the volatility in the value of Bitcoin and a significant increase in the rates to process transactions in the Bitcoin network". [19659004] The reason for this is inherent in the way the Bitcoin protocol works; The number of bitcoins is controlled by computers that generate them through so-called "mining" operations, which are essentially complicated mathematical problems. That slows down the growth in the number of bitcoins that exist, but as the value of those bitcoins has skyrocketed, miners are devoting more and more computational resources to compete for new currencies, which requires large amounts of electricity and time. The speculative frenzy has sometimes created a mbadive delay in the already intrinsically limited speed of transactions through the Bitcoin network and has increased processing fees.

The result is that at the same time Bitcoin needs a wide adoption to break beyond being a purely speculative investment, it is becoming more difficult and frustrating for retailers. According to Valve, transaction fees have skyrocketed from their original cost of 20 cents to about $ 20, a 100-fold increase over the past year. And since those transactions are often delayed at the same time as the bitcoin value fluctuates rapidly, real problems have arisen:

When paying on Steam, a customer will transfer x amount of Bitcoin for the cost of the game, plus and amount of Bitcoin to cover the transaction fee charged by the Bitcoin network. The Bitcoin value is only guaranteed for a certain period of time, so if the transaction is not completed within that period of time, the amount of Bitcoin needed to cover the transaction may change. The amount that can change has recently increased to a point where it can be significantly different.

There is not a good customer service response to this problem, Valve added, because if there is an imbalance in payments, the same problem can recur, and users can be hit with additional transaction fees.

"At this point, it has become untenable to support Bitcoin as a payment option," Valve concluded. "We can re-evaluate whether Bitcoin makes sense to us and to the Steam community at a later date."

Recently Bitcoin jumped to $ 14,000 this week, which means that if Valve is in a horde of digital currency, it's probably making a serious bank. But Valve is in the videogame distribution business, not in the cryptocurrency speculation business. In addition, it was one of the few large retailers that accepted bitcoins at all. Steam's retraction from the market is another blow to Bitcoin's already scarce utility beyond speculative investment, hoarding and, of course, various schemes of fraud and scams.

As the bubble grows, Bitcoin also faces regulatory problems. Many countries, including China, South Korea and Russia, have opposed the cryptocurrency sector. In the United States, the Securities and Exchange Commission has signaled growing skepticism about cryptography in general, while the Internal Revenue Service is preparing a major offensive against people who use it to evade taxes.

[The Verge]

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