update 27 November 2021

Stripe Shows Consideration For Supporting Crypto Payments Again

The success of Bitcoin’s lightning network may bring one noteworthy payment process back into the asset. Stripe – a financial services and software company – recently stated that it could begin supporting Bitcoin payments again. This comes after Stripe ended support for the cryptocurrency in 2018 due to slow transaction speeds.

Could Stripe Return to Bitcoin?

John Collison – Co-Founder of Stripe – expressed re-consideration for Bitcoin to CNBC on Tuesday.

He recognized that the asset class means different things to different people when asked about cryptocurrencies more broadly. Collison doesn’t have an interest in the speculative side of the space. However, the recent developments making cryptocurrencies more “scalable” have intrigued him.

“You have the ‘layer 2’ chains like lightning, [or] efforts like Solana – a dedicated chain towards payments. I think all of that work is really interesting, because we are more interested in bringing more people into the global economy at Stripe.”

Stripe gave up on bitcoin, but co-founder John Collison is excited about the future of crypto - Vox
John Collison. Source: Vox

Lightning network is a layer-2 Bitcoin scaling solution allowing transactions to be bundled together through deferred settlement. For example, El Salvador utilises lightning to enable Bitcoin payments across the country and receive cheap remittances from the US.

Collison said that crypto could bring significant benefits to countries that don’t already have sophisticated payment systems. Therefore, the technology could fit well at Stripe.

“As we at Stripe think about global coverage, then you start asking, ‘is crypto an interesting way to compliment that?’”

While Stripe does not yet support crypto payments, the co-founder said that it’s “not implausible” that they would in the future.

Bitcoin as a Payment Method

Stripe formerly supported Bitcoin payments as early as 2014, hoping it would become a “universal, decentralized substrate for online transactions.”

However, as Bitcoin adoption increased, its 1 Megabyte blocks quickly proved insufficient for supporting payments across the globe. Transaction times and fees became unmanageable, even creating discrepancies in Bitcoin transactions denominated in fiat currencies. By the time transactions settled, the amount had received often differed from the agreed price due to Bitcoin price fluctuations. As such, Stripe was forced to end its Bitcoin support in 2018.

price change

Fortunately for Bitcoin, multiple other institutions have adopted Bitcoin as a payment vehicle since. For example, earlier this year, Jacksonville began considering using Bitcoin for paying taxes and local fees. More recently, Australian baseball club Perth Heat has already started utilizing lightning to compensate everyone. They are even allowing customers to pay for merchandise using Bitcoin.