Bitcoin payments decline as other cryptocurrencies grow

[_act_]

According to the news, it is said that bitcoin payment of users that use BitPay has declined from 92% in 2020 to 65% in 2021.

https://wealthybot.io/bitcoin-payments-decline-as-other-cryptocurrencies-grow/

According to BitPay, Bitcoin’s (BTC) usage at businesses that use its payment system fell last year to about 65% of processed transactions, down from 92% in 2020. Along with this change, Ether (ETH) represented 15% of all transactions, whereas other currencies such as Litecoin (LTC) and Dash have increased their portion.

Businesses have started using stablecoins more frequently for cross-border payments since November when crypto values had been depreciating.

Hope this will not affect bitcoin adoption if people that are using it for payment is decreasing?

On the other side, I am thinking bitcoin is not just a coin that can be used for payment, it can be used for asset too.

And now that bitcoin fee is that high, what I noticed is that bitcoin exchange fee is higher than actual bitcoin fee, this make people to think it is high. Even less than $1 I used to make the last bitcoin transaction recently but if exchanges are charging 0.0005 bitcoin to a high amount over 0.0012 bitcoin which is $20 and above. They are misleading people to pay high fee when it is not.

People that are using bitcoin now are using exchanges and centralized wallets that charge high fee in a way it will also discourage some people to move the coin to a private key wallet.

The reason for the high fee is because of centralized sites like centralized wallets and exchanges. To use low fee, you can use noncustododial wallet.

[NeuroticFish]

According to BitPay

Bitcoiners avoid BitPay because of unreasonable requirements for KYC.
Before, bitcoiners used to avoid BitPay because they were favoring BCH and had bigger fees for bitcoin.

All in all, the fact BitPay business doesn't go so great as bitcoin payment processor doesn't mean at all that bitcoin payments would be in a decline.

And now that bitcoin fee is that high, what I noticed is that bitcoin exchange fee is higher than actual bitcoin fee, this make people to think it is high.

If one uses custodian wallet, he pays whatever the custodian asks and - especially in case of exchanges - the withdrawal fee is big and unrelated to network fee.
I've made transaction 2 days ago and iirc the fee was under 10 cents. Now it's 5-6 times bigger if you're in a hurry, but that's still way under 1$.
Bitcoin transactions are not expensive nowadays. The reality is different than what various "friends" advertise.

And there's always LN for faster and cheaper payments.

The reason for the high fee is because of centralized sites like centralized wallets and exchanges. To use low fee, you can use noncustododial wallet.

That's correct. Also for smaller fees use bc1 addresses. And also the (legit) non-custodial wallets are usually better for your funds' safety (just you have to learn yourself to do everything correct).

[Lucius]

Hope this will not affect bitcoin adoption if people that are using it for payment is decreasing?
On the other side, I am thinking bitcoin is not just a coin that can be used for payment, it can be used for asset too.

Those who want to understand have long realized that more and more people are pushing the idea of Bitcoin as a store of value/digital gold rather than currency. When I say more and more people, I mean primarily influential ones like Mr. Mars (EM) who bought some 40 000 BTC, but at the same time thinks that same BTC is not appropriate to use as a currency. People are following the examples of their idols, and what that will mean for Bitcoin, time will tell.

And now that bitcoin fee is that high, what I noticed is that bitcoin exchange fee is higher than actual bitcoin fee, this make people to think it is high. Even less than $1 I used to make the last bitcoin transaction recently but if exchanges are charging $0.0005 bitcoin to a high amount over 0.0012 bitcoin which is $20 and above. They are misleading people to pay high fee when it is not.

It's called business and market economy, people pay for the service very expensively, and at the same time complain that banks are expensive - paradoxically custodial crypto services are far more expensive than banks. Of course, it's not just about making money that way, but also keeping liquidity of crypto exchanges that would be far less if their fee was below $5, which would be quite realistic.

[buwaytress]

Oh but of course, if people stop using BitPay, it means they've stopped using Bitcoin altogether now.

Coinspaid claims 2021 was its peak, growing each year in terms of Bitcoin payments processed using it. I guess they're lying.

BTCPayServer has been getting better and better, and merchants who pass through the hurdle of self-learning are saying they like it. But I guess they're lying too.

MisterTango, Coinpayment, Bitkassa are just some I've used in the past, and I know they're still developing new stuff. Would they be doing that if usage was not growing? Or are they part of the lie?

[LoyceV]

Bitcoiners avoid BitPay because of unreasonable requirements for KYC.
Before, bitcoiners used to avoid BitPay because they were favoring BCH and had bigger fees for bitcoin.

This sums it up
I used to use Bitpay, now I don't use Bitpay. That doesn't mean Bitcoin payments declined (I'm still using Bitcoin for payments), it means Bitpay payments declined. Serves them well!

And now that bitcoin fee is that high, what I noticed is that bitcoin exchange fee is higher than actual bitcoin fee, this make people to think it is high. Even less than $1 I used to make the last bitcoin transaction recently but if exchanges are charging $0.0005 bitcoin to a high amount over 0.0012 bitcoin which is $20 and above. They are misleading people to pay high fee when it is not.

Certain websites (like Binance) have their own financial interests to make people accept their made-up tokens over Bitcoin, and people fall for that! If only more people would use their own wallets and hold their own keys, they'd realize how low transaction fees in Bitcoin actually are. I paid (converted to dollars) $0.05 in fees for my last on-chain Bitcoin transaction.

Don't write "$0.0005" bitcoin, that doesn't make sense.

[davis196]

And now that bitcoin fee is that high, what I noticed is that bitcoin exchange fee is higher than actual bitcoin fee, this make people to think it is high. Even less than $1 I used to make the last bitcoin transaction recently but if exchanges are charging $0.0005 bitcoin to a high amount over 0.0012 bitcoin which is $20 and above. They are misleading people to pay high fee when it is not.

I don't think that all crypto trading platforms are misleading the people.Probably some of them.
Crypto exchanges are the same as banks.They want to make money.
They will impose high fees,as long as the customers are OK with paying those high fees.If the fees become too high,the customers will simply choose another service or completely stop using crypto exchange platforms.Nobody is obligated to use their services.
I couldn't care less about Bitpay and what they have to say about Bitcoin usage on their platform.
The majority of the people simply don't want to spend Bitcoin for goods and services.
It's pretty normal that some altcoins and stablecoins are being preferred over Bitcoin for retail payments.

 

[NeuroticFish]

And now that bitcoin fee is that high, what I noticed is that bitcoin exchange fee is higher than actual bitcoin fee, this make people to think it is high. Even less than $1 I used to make the last bitcoin transaction recently but if exchanges are charging $0.0005 bitcoin to a high amount over 0.0012 bitcoin which is $20 and above. They are misleading people to pay high fee when it is not.

I don't think that all crypto trading platforms are misleading the people.Probably some of them.
Crypto exchanges are the same as banks.They want to make money.

Even more, they prefer the money stay on their platform. Also their transaction related code is usually obsolete and poorly configured.
However, I agree to OP about misleading. Most exchanges use such words related to their withdrawal fee that people think that is the network fee (transaction fee). And this makes many newbies get misled that bitcoin transaction fees are high.
While exchanges do use high transaction fees to make sure the money does arrive fast to the recipient, it's not uncommon neither to see them use less fee than the money asked from the user for that, neither pay unreasonably high fee. And of course, they'll say it's the network fee...

[_act_]

Bitcoiners avoid BitPay because of unreasonable requirements for KYC.

I wrote about it because of the news and because it can slightly indicate how people are using altcoins with low fee and stable coins for making transaction when exchanges and custodial wallets are confusing people that bitcoin fee is high but not high like they said.

I use electrum, I have used it to buy, sell, shop online. What else do I need? I know payment processors can help  stores like online stores and many like that, that is why they use it, but as for me for now, I am good with electrum.

And there's always LN for faster and cheaper payments.

I do not need it for now because the onchain fee is low, I can just remain some little amount on it if I see people that are interested to use it for payment, but I will need it more during when the fee is high, but bitcoin fee is still low for now.

Don't write "$0.0005" bitcoin, that doesn't make sense.

It was a mistake, I have corrected it. Thanks.

[NeuroticFish]

Bitcoiners avoid BitPay because of unreasonable requirements for KYC.

I write about it because if the news and because it can slightly indicate how people are using altcoins with low fee and stable coins for making transaction when exchanges and custodial wallets are confusing people that bitcoin fee is high but not high.

I've been criticizing BitPay, not you. Actually, it was not even criticism, it was basically stating the reality.

I use electrum, I have used it to buy, sell, shop online. What else do I need? I know payment processors can help stores and many like that, that is why they use them, but as for me for now, I am good with electrum.

I also use Electrum. I use it with a HW because I feel that this is the proper way to do it. And if I'd have a shop, then I'd probably use BTCPay.
There are almost always good solutions at hand. And we, those staying more online on this forum, usually know them.
Unfortunately I feel that we're a minority and the rest are going by what the news are telling, which can be in (too) many cases wrong and misleading.

And there's always LN for faster and cheaper payments.

I do not need it for now because the fee is low, I can just remain some little amount on it if I see people that are interested to use it for payment, but I will require it more during when the fee is high, but bitcoin fee is still low.

It's not only you and be who will read this. Some can wait even until the week-end to send a transaction, some others find out that even 10 minutes is too slow. People are different, hence it worth mentioning it.

[rdbase]

I haven't been offered to pay by bitpay in a very long time. I think I've seen it some time before boxing day last year for one merchant but there are several ways now offered by other means to get purchases done with cryptocurrencies.
Such as credit cards that convert crypto into fiat inorder so to make those payments and coinbase/paypal that now accepts crypto.
There was an article about it, from a source where you would not have imagined to cover it, TIME magazine on how bitcoin's dominance of payments have declined in the past year. Only accounting for 65% of all payments and ethereum 15% while other coins which have been added to bitpay to possibly have more people have a use for it's service in the future.
https://time.com/6139727/bitcoin-crypto-payments

[bittraffic]

BitPay shouldn't be the one that will release such news and statistic because they are not the only platform to use to pay something thru BTC. There is more activity and adoption of BTC everywhere since cryptocurrency is now on mainstream media.

It may however also make sense o use.stablecoin in paying something if the merchant accepts it. I would prefer to do the same to keep my BTC.

[batang_bitcoin]

On the other side, I am thinking bitcoin is not just a coin that can be used for payment, it can be used for asset too.

Bitcoin has been used as an asset and even a store of value for a long time. It's not just a speculation but it's the actual, the reality that many are using their bitcoin as their storage of wealth.
Besides, it's not only bitpay that has been the third party service out there that automatically converts bitcoin into fiat. If people are keeping their bitcoin, it only means that they don't want to spend it for purchases because altcoins are easier to spend that way.

[JohnBitCo]

Bitcoiners avoid BitPay because of unreasonable requirements for KYC.

I wrote about it because of the news and because it can slightly indicate how people are using altcoins with low fee and stable coins for making transaction when exchanges and custodial wallets are confusing people that bitcoin fee is high but not high like they said.

I use electrum, I have used it to buy, sell, shop online. What else do I need? I know payment processors can help  stores like online stores and many like that, that is why they use it, but as for me for now, I am good with electrum.

Many people avoid bitcoin to conduct transactions if they have the option to transact with other cryptocurrencies. I would rather prefer to make payments with litecoins and avoid bitcoin/ethereum because of their high fee. But that does not mean that i would not accumulate them.
People will keep on accumulating bitcoins but they spent other crypto's. Hope this makes you understand how valuable is bitcoin 

[LoyceV]

And there's always LN for faster and cheaper payments.

I do not need it for now because the onchain fee is low, I can just remain some little amount on it if I see people that are interested to use it for payment, but I will need it more during when the fee is high, but bitcoin fee is still low for now.

I like to be prepared: if fees rise a lot, I'm too late to open LN channels. Funding LN is just like consolidating small inputs: do it when fees are low.

[fiulpro]

First if all the cryptocurrencies have various charge for the payments, we also have to consider the fact that some Altcoins generally have very less fee which makes them better to send/receive. I do think that people are not so sure when they use the Lightning network Because it's most suitable for the micropayments..plus it's only one provider we are talking about. It might have been getting better at other platforms ad well. I do think that we can actually use other options like : SegWit and then at the same time inform other people regarding the options they might have. I don't think that any other cryptocurrency would have more growth as compared to bitcoins.

[hatshepsut93]

Bitcoin's share of transactions on BitPay decreasing doesn't mean that Bitcoin payments have declined. They didn't release the absolute number, maybe Bitcoin payments were actually up, but altcoin payments on BitPay grew faster.

In any case, the data from one centralized service is not enough to judge the whole ecosystem, even if this service is one of the biggest players. And Bitcoin payments are gradually shifting towards Lightning Network, while many altcoins don't have similar technology and rely on stupid big block scaling.

[pooya87]

Hope this will not affect bitcoin adoption if people that are using it for payment is decreasing?

Technically those who use centralized third parties aren't even using bitcoin in first place. So it doesn't affect bitcoin adoption at all.

And now that bitcoin fee is that high,

Basically bitcoin fees haven't been high ever since 2017!

if exchanges are charging 0.0005 bitcoin

You are paying the exchanges (and any other similar centralized services like Bitpay) to use their service. It is the cost of using them. It has nothing to do with bitcoin or its transaction fees though.

I wrote about it because of the news and because it can slightly indicate how people are using altcoins with low fee

Interesting statement because most altcoins that had a small increase in their usage had a much bigger fee spike than bitcoin. Specially these days that they are facing huge fees due to the altcoin bloodbath. For example ETH fee that you mentioned earlier has reached more than $80 on average!

when exchanges and custodial wallets are confusing people that bitcoin fee is high but not high like they said.

I don't think they are.
Despite what it may look like, majority of people don't use exchanges or custodial wallets.

[Fundamentals Of]

I agree. Most of the time, the reason for the high fees is that the exchanges and other custodial wallets are charging more than what is necessary. They don't provide their clients the option to choose their own fee. But it is also true that there are times when the network is really clogged that the fees will experience a spike. But this has been acknowledged and given a solution.

The rising fee is certainly one of the reasons why Bitcoin is now being used less and less as a payment. But it is now addressed with the Lightning Network. As soon as the Lightning Network adoption will spread widely enough, there will definitely be a change in the numbers.

But with the price of Bitcoin rising big time in the past years, who would want to spend their Bitcoin? Many are holding theirs tightly and even adding more.

[avikz]

Btc and eth are not good for everyday transactions because you will only end up paying more on transaction fees, am not too surprised with the report, people use stablecoins from networks with less fees like bsc, Tron to pay transactions,
Even though the third party also collects fees these networks are not designed to be cheap, it will be hard for small-income people to use these coins so definitely there will be a shift.

I second your statement here! Bitcoin and ETH are costly to use as a regular currency unless we are using LN or WETH. In the market, we have much better currency for regular transactions. So I am not surprised to see the number of transactions are declining in the bitcoin network.

But does it affect the reputation of bitcoin? I don't think so! Bitcoin is still the most preferred investment choice amongst the crypto community. That's what bitcoin is great for!

[Ararbermas]

It's not a big deal mate bitpay is more favorable in other crypto than bitcoin so don't be surprised and surely it cannot affect the adoption since it's not the only option we have in the space wherein there's a bunch of platforms and sites to be honest in order to spread bitcoin and very popular than bitpay. So no need to worry about that..