Why Steam Terminated Support For Bitcoin As Payment Method


This Wednesday, Valve announced via Steam Blog that its digital distribution platform will henceforth not accept Bitcoin as payment for its content and services.

For example, Valve says that the transaction fee was roughly $0.20 when it started supporting Bitcoin as a payment option on Steam.

The company detailed the decision on Steam's official blog, explaining that recent fluctuations in the value of Bitcoin have made using it on Steam unreasonably hard and costly for consumers.

Since the value of Bitcoin is "only guaranteed for a certain period of time", if a transaction is not completed within that time frame, the value of the agreed upon BTC can fluctuate greatly, leaving either customers or Valve to cover the difference. However, as Valve explains, "In both these cases, the user is hit with the Bitcoin network transaction fee again", and the number of customers affected by this issue is reportedly increasing.

At a time when the whole world is going insane over bitcoin, Steam has made a decision to pull the plug on bitcoin transactions because of network congestion, price volatility and exorbitant fees. There are some major companies, such as Microsoft and DISH, accepting bitcoin payment, but few others have followed suit.

But this only applies if you were holding BTC and wanted to see the price drive up, meaning you wouldn't use it in the real-world if the value continues skyrocketing like it has this year - going from $1000 to almost $13,000 in 12 months. Valve has chose to cut off the ability for Steam users to make purchases with the currency. The price of the infamous Bitcoin pizza that was purchased for 10,000 Bitcoin in 2010 is now worth over $123 million.

Steam's resolutions to this, refunding the payment or asking for a transfer of additional funds, incurs network transaction fee which comes in addition to the base transaction fee.

"The amount it can change has been increasing recently to a point where it can be significantly different", wrote Chinn.

However, bitcoin's rollercoaster past couple of months have changed Steam's plans. 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. "We may re-evaluate whether Bitcoin makes sense for us and for the Steam community at a later date", Valve said.