Bitcoin payments decline as other cryptocurrencies grow

[Fundamentals Of]

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..

I think BitPay is a big player in the Bitcoin payment processing industry. So it somehow matters that the payments using Bitcoin in the platform is declining. I guess it is only Coinbase payment processing service that is larger than BitPay.

But the adoption that Bitcoin supporters are really looking forward is not the one that's being done by BitPay. Bitcoin-to-Bitcoin payment is what everybody dreams of. So whether Bitcoin payment through BitPay will eventually become unpopular doesn't necessarily mean the adoption is not growing.

[Abiky]

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.

Exactly. No one said Bitcoin users conduct their transactions through BitPay only. There are other payment gateways (eg: Coinpayments) merchants use to accept Bitcoin as payment method. The fact that Bitcoin's share of transactions is declining on BitPay, tells us that most merchants don't want to go through the hurdles of KYC. Crypto is all about decentralization and financial inclusion, so one would guess non-custodial alternatives to BitPay like Request.Network and BTCPayServer will take off soon. The Lightning Network is experiencing some steady growth lately, so there's that. Like it or not, Bitcoin is more active than most altcoins on the market. Transaction activity is far superior than those in alternative blockchains like Bitcoin Cash, Bitcoin SV, Dogecoin, and Litecoin. As Bitcoin continues to reach new All-time-highs, more people will join the game. Just sit back, relax, and watch mainstream adoption grow like never before. Just my opinion

[pooya87]

Transaction activity is far superior than those in alternative blockchains like Bitcoin Cash, Bitcoin SV, Dogecoin, and Litecoin.

Interesting thing is that the transaction count on some of these shitcoin blockchains are very small and hasn't increased compared to before, like bcash for example. Meanwhile Bitpay is reporting an increased number of payments through these shitcoins.
The only possible explanation is that they are reporting fake stats trying to pump shitcoins they have some stake in. Since they have been pushing shitcoins like bcash, it is a strong possibility too.

[jaberwock]

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.

I feel people are not too comfortable using their BTC for such transactions. Using myself as a case study, I would feel more comfortable transacting with altcoins  and not BTC. I would suggest that Bitpay should use other reputed altcoins like Lite Coin, Dash and other altcoins. Such that if any thing should happen individuals will not loss their precious coins.

This will not have negative impact on bitcoin in my opinion. I guess already many people might have started valuing the saving of bitcoin for future and might have stopped spending bitcoin for day to day life. valuing bitcoin for the sake of long term holding must be a highly benefiting idea in my view.

[kawetsriyanto]

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

You cannot generalize it based on Bitpay data only. The decrease of Bitcoin payment usage in Bitpay probably won't happen on the other payment services. I think it makes sense if Bitpay experienced a decline since there are already many sites with the same functions as Bitpay nowadays. So, people use other platforms that offer simple requirements, fast processes, or lower fees. Sure, the decline won't affect bitcoin adoption in general. The problem only happens in Bitpay, not to all providers of bitcoin payment services.

[Abiky]

I feel people are not too comfortable using their BTC for such transactions. Using myself as a case study, I would feel more comfortable transacting with altcoins  and not BTC. I would suggest that Bitpay should use other reputed altcoins like Lite Coin, Dash and other altcoins. Such that if any thing should happen individuals will not loss their precious coins.

This will not have negative impact on bitcoin in my opinion. I guess already many people might have started valuing the saving of bitcoin for future and might have stopped spending bitcoin for day to day life. valuing bitcoin for the sake of long term holding must be a highly benefiting idea in my view.

Most merchants are simply avoiding Bitpay because of KYC. They switched to non-custodial (decentralized) alternatives that allows them to accept Bitcoin directly without third parties. Just because transaction activity has declined on Bitpay, doesn't mean people are jumping off ship. You'd have to consider network activity itself in order to determine such conclusion. As I've said before, Bitcoin is far more active than most altcoins being traded on the market today. Some merchants and customers are switching to altcoins because of the low fees and fast settlement times. But Bitcoin's fees are declining, so it should only be a matter of time before altcoins lose traction in the mainstream world. With the Lightning Network in the works, Bitcoin is on a road towards mass adoption by people worldwide. Who knows if increased adoption, leads us to a higher price per coin in the not-so-distant future? Just my opinion

[LUCKMCFLY]

You cannot generalize it based on Bitpay data only. The decrease of Bitcoin payment usage in Bitpay probably won't happen on the other payment services. I think it makes sense if Bitpay experienced a decline since there are already many sites with the same functions as Bitpay nowadays. So, people use other platforms that offer simple requirements, fast processes, or lower fees. Sure, the decline won't affect bitcoin adoption in general. The problem only happens in Bitpay, not to all providers of bitcoin payment services.

I agree with that statement, because not all payments are through Bitpay, there are many payments that are made for goods and services that we do not even realize what has been purchased and what has not, if we start to analyze it is dif' ciil to keep track of where a BTC or many BTC is going or what its destination is, or what purpose it has, the enemies of BTC say and affirm that a lot of the BTC goes to criminals, but I think that criminals like it better fiat money than the same BTC or cryptocurrencies, because they like to see the value without lowering the price, so they are very subjective things.

[adzino]

Or maybe it is BitPay that failed to attract BTC users to use their payment gateway due to poor service or some other reason? People still use bitcoin. The fee isn't very high now. You can get your transaction confirmed within the next block even if you pay less than $1.

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.

I guess they only use a small portion of the fee as a network fee and keeps the rest as their own fee. But yeah, they should mention that whenever a user withdraws their fund. Separate network fee from their own fee so users can better understand how the fees work. And no one should be using an exchange or a centralized wallet to store their coins and make transactions. If they think a little, they will know that in the long run moving their funds to their own noncustodial wallet will save them more in fees.

[LoyceV]

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 guess they only use a small portion of the fee as a network fee and keeps the rest as their own fee. But yeah, they should mention that whenever a user withdraws their fund. Separate network fee from their own fee so users can better understand how the fees work.

People should avoid exchanges that overcharge in fees. Some exchanges charge only 2000 sat for withdrawals, and that's still more than enough to pay transaction fees! As long as people keep using those exchanges, it's in the exchanges best interest to keep fees high and discourage users from withdrawing real Bitcoins.

You can get your transaction confirmed within the next block even if you pay less than $1.

For the record: $0.10 is more than enough too for a transaction with 1 input.

[Tellek Garing]

I think the answer is NO because bitpay is not the only bitcoin payment gateway and the data collection is based on bitpay users alone, so the total statistics of 65% does not reflect the total number of Bitcoin users that pay with bitcoin.
If you want to know the level of bitcoin adoption you should check the activities of wallet users active ones that way you know the percentage of Bitcoin adoption.

[franky1]

As long as people keep using those exchanges, it's in the exchanges best interest to keep fees high and discourage users from withdrawing real Bitcoins.

and he hits the nail on the head. (translation. 'he is spot on')
 though i doubt he realises what he says in regards to other offchain services that want people to keep their value locked into offchain systems. or sway them to swap to altcoins to exit the offchain systems. hopefully LoyceV will expand his thought and see where it also applies to other offchain systems.

..
that said, bitpay used to be the number one payment service for merchant tools years ago. but they purposefully added altcoin offerings which automatically bring the number below 100% and then by having steep fee's compared to other services. bitpay has lost alot of btc customerbase.

its not to say that btc has declined. its to say that merchants just dont use bitpay for their merchant tools.
now with many exchanges having merchant tools and many other services, ALOT more bitcoiners use those. leaving bitpay with the laggers.

bitpay had over 10,000 merchants using it in 2013.. by the look of the transaction numbers i dont see they still have 10,000 merchants. because if they did it would be only ~4 transactions a month per merchant.

bitcoin merchants now use other commercial services to accept bitcoin

[DoublerHunter]

I think the answer is NO because bitpay is not the only bitcoin payment gateway and the data collection is based on bitpay users alone, so the total statistics of 65% does not reflect the total number of Bitcoin users that pay with bitcoin.
If you want to know the level of bitcoin adoption you should check the activities of wallet users active ones that way you know the percentage of Bitcoin adoption.

^ If that is true which is also I have doubt that most people now are holding their BTC assets than expending it.
There is no way to have a perfect stat like this but if this is only intended for the Bitpay user only possible that they can able to trace the transactions.
In this case, I most likely believe that BTC was now storing the value not spending for the daily needs or so whatever it is. Holding is the best decision for the long term because the price becomes higher and higher, so possible BTC price will not immediately recover from the correction.

[DaveF]

I mentioned it someplace else, but it should be mentioned that BitPay is going after a different type of business now other then small merchants direct.
They seem to want to be the 'crypto processor of choice' by getting into partnerships with existing payment services.

Here: https://bitcointalk.org/index.php?topic=5362990.0
and here: https://www.businesswire.com/news/home/20211012005376/en/BitPay-Partners-with-Wix-Enabling-Wix-Merchants-to-Accept-Crypto-Payments

So looking at the numbers dropping from BitPay and thinking that it means something MAY be a mistake. It could just be they are changing who they are targeting and it takes a while for the other business to catch up.

-Dave

[Yamifoud]

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.

That could be a factor if people are now securing the value of their money and that urge them to use stablecoins instead of Bitcoin. With that 1 year observation, I think it was reliable and that was too convincing that people are just considering Bitcoin as an investment, not a currency anymore. And with the existing downtrend of the price, the more they'll hold and not to sell nor it spends them. Likely, if the situation goes like this, we can't hide the possibility that instead of seeing Bitcoin become a legal tender it will fail.

[kryptqnick]

Is the percentage showing the number of transactions in Bitcoin vs Ethereum and other coins or is it the volume? Because I think the volume is not less important, and I wonder what's the percentage of Bitcoin and Ethereum by volume on BitPay in 2021 compared to 2020. Also, a decline in payments doesn't mean that Bitcoin's losing popularity or anything. Even the article linked by the op suggests that it means people prefer hodling. So people largely saw Bitcoin as an investment and didn't care to use it for payments as much (if the transaction volume confirms it, and I'm not sure it does). I am surprised that Ethereum's popular for payments, though, because it often had way higher transaction fees than Bitcoin in 2021. And the arguments that BitPay's being avoided is also valid for questioning the data and conclusions.

[RealMalatesta]

I think the answer is NO because bitpay is not the only bitcoin payment gateway and the data collection is based on bitpay users alone, so the total statistics of 65% does not reflect the total number of Bitcoin users that pay with bitcoin.
If you want to know the level of bitcoin adoption you should check the activities of wallet users active ones that way you know the percentage of Bitcoin adoption.

Well, in this case it is like a sampling and when you’re doing sampling you don’t use all the materials, rather you make use of a selected few or even one of the materials as a sample. So, we don’t have to get data from every platform, because BitPay is already serving as that sample. And even without being told, you already what would likely happen in a situation like this.

When the market is going down people would try to avoid losing their money, and therefore they would leave the market, until maybe things stabilizes or the market starts going up again. If there is the possibility of getting data from other platforms, it would also reflect the same thing.

[so98nn]

Apart from the privacy concerns and reduced transaction based on that fact one can also assume that with the ever changing and volatile market, peeps are not making much moment currently or they might be just securing the funds in stable coin to reduce the further losses. In crypto possibilities are huge. For example, different markets like NFT, Defi are emerging at alarming rate and it’s possibility that investors are converting the bitcoin or buying the NFT for future profits. However, any average investor in the crypto space will always have bitcoins in his pockets and will always convert the profits into bitcoin at the end.

[eaLiTy]

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.

With the huge rally we had in the BTCitcoin market, everyone is holding their coins thinking of a much bigger profit than spending them for transactions. Expect these situations during a bull market and it would be interesting to see the same data next year when there is a reversal of trend.

~
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.

That is the mistake majority of the users are doing, it is clear that it is not safe to hold your coins in third party wallets or exchanges and even with N number of hacks, no one would change. Always use your stand alone wallet to store the coins and it is not hard to use them.

[AmoreJaz]

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.

With the huge rally we had in the BTCitcoin market, everyone is holding their coins thinking of a much bigger profit than spending them for transactions. Expect these situations during a bull market and it would be interesting to see the same data next year when there is a reversal of trend.

~
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.

That is the mistake majority of the users are doing, it is clear that it is not safe to hold your coins in third party wallets or exchanges and even with N number of hacks, no one would change. Always use your stand alone wallet to store the coins and it is not hard to use them.

as presented by the OP, the decline of payment is via bitpay. so it doesn't include other payment channels. maybe, the reason why bitpay's usage is declining because of their high fees and now, users are finding cheaper alternatives.
also, as said above, a lot are also holding their coins for the hope that this will be good investment that can give them good profits. there are many factors to consider here. but the adoption is growing as well as number of crypto users.

[Beparanf]

Apart from the privacy concerns and reduced transaction based on that fact one can also assume that with the ever changing and volatile market, peeps are not making much moment currently or they might be just securing the funds in stable coin to reduce the further losses. In crypto possibilities are huge. For example, different markets like NFT, Defi are emerging at alarming rate and it’s possibility that investors are converting the bitcoin or buying the NFT for future profits. However, any average investor in the crypto space will always have bitcoins in his pockets and will always convert the profits into bitcoin at the end.

Some were taking this time to try new projects while waiting for the continuous recovery of bitcoin. NFT is getting hyped on how someone can earn thru digital creations and thru playing games, there are trying to have it due at this time the market is down knowing Metaverse can improve the market condition soon. Still BTC and top or  trusted cryptocurrencies can recover whenever the market experience bear season.