- Coinbase has announced the “difficult decision” to cease Bitcoin support on its payments platform
- Coinbase Commerce product lead Lauren Dowling cited Bitcoin’s incompatible infrastructure with its aim of promoting fast and affordable payments
- This decision will extend to other older chains like Dogecoin, Bitcoin Cash, and Litecoin
Coinbase says it has made the “difficult decision” to drop support for Bitcoin from its payments platform. Coinbase Commerce announced the decision over the weekend, with its product lead, Lauren Dowling, saying in an X thread that the Bitcoin infrastructure isn’t compatible with the department’s mission to encourage fast and cheap payments. The change will also affect other older chains such as Dogecoin, Bitcoin Cash, and Litecoin, while CEO Brian Armstrong said the company was focused on Layer 2 solutions.
Bye Bye Bitcoin (Sort Of)
Dowling’s tweet thread explained that the company’s merchant offering has three primary challenges: crypto volatility risk, the manual burden of resolving incorrect payments (eg: underpaid), and limited asset support. As a result, the company has built a new EVM payment protocol that enables payments from any self-custody wallet and covers multiple blockchains.
This new methodology, Download said, meant that certain blockchains were now either incompatible or were simply not able to meet their demands:
6/ Delivering these same capabilities on the Bitcoin blockchain without smart contracts and stablecoins was challenging & we therefore made the difficult decision to remove native Bitcoin & other UTXO support.
— Lauren Dowling (@Lauren_Dowling_) February 17, 2024
Customers still have the ability to pay with UTXO assets like Bitcoin from their Coinbase account, but the change will also affect other UTXO-based chains like Bitcoin Cash, Litecoin, and Dogecoin.
Armstrong Still Carries a Torch for Lightning
Coinbase CEO Brian Armstrong added some context to the decision, claiming in an X post that the company’s approach to online commerce has shifted. Armstrong stated his belief that the future of crypto payments will primarily occur on Layer 2, such as the Lightning Network, and that Coinbase wants to “help make that happen”:
This isn’t quite right, so let me share some more context in case helpful:
– Commerce uses a new EVM payment protocol.
– You can pay from any self-custody wallet
– We believe paying with crypto is going to primarily happen on Layer 2 in the future and we want to help make that…— Brian Armstrong 🛡️ (@brian_armstrong) February 17, 2024
Armstrong added that the quickest checkout method on its platform involves using ERC-20 tokens on Layer 2, such as Ethereum, USDC, or wrapped Bitcoin. Additionally, customers have the option to pay with a Coinbase account, including direct Bitcoin transactions, which are processed off-chain for instant and fee-free transactions.
He also reaffirmed Coinbase’s intention to integrate Lightning Network, which could open up more opportunities for Lightning payments in commerce in the future.
