Valve Corporation co-founder, Gabe Newell, recently spilled the beans on why the company removed Bitcoin as a payment method on their popular gaming platform, steam. Newell explained that his firm had to stop accepting cryptocurrency payments on the platform after less than 2 years of expanding their payment methods.
Steam is a popular video game digital distribution service developed by Valve Corporation. The web-based platform supports games developed by Valve corporation as well as third-party publishers. In April 2016, Valve opted to introduce Bitcoin as a payment method on the platform but this payment method was removed in December 2017. Only recently, the true reasons behind the removal have finally been made known.
Increased Insecurity
When removing Bitcoin as a payment option in 2017, Steam told the press that their decision came from the volatility of the price of bitcoin. Another reason is the significant increase in transaction processing fees on the Bitcoin network.
However, Newell recently revealed there was much more to dropping Bitcoin as a payment option than was previously announced. In a recent interview, the executive stated that many swindlers and scammers made use of Bitcoin to take advantage of the Steam platform. According to Newell, about 50 percent of the transactions made using Bitcoin were fraudulent. That meant 50 percent of the customers who used the platform during those 20 months were not customers but scammers.
Newell pointed out that blockchain technology offers a lot of interesting opportunities. However, he believes that people are yet to figure it out completely. Until many of the shortcomings of cryptocurrencies and non-fungible tokens (NFTs) are figured out, scammers will continue to use cryptocurrencies to rip people off.
The Steam co-founder stated that Steam would not want to enable scammers to take advantage of large numbers of people. This is what drove their decision.
Still not a fan of crypto and NFTs
Steam continues to be resistant to the integration of crypto to the platform. They have also gone a step further to ban games with NFT. Early this year, Steam was reported to not allow games with NFT on its platform citing that these games involved many bad actors.
Despite the frequent scams and the large number of bad actors known to make use of the NFT space, many platforms are still supporting NFT payments and cryptocurrencies. Popular gaming platforms such as Ubisoft are continuously seeking ways to monetize and grow the sector.
However, Steam isn’t going to be one of those platforms. Their experience with NFTs and Bitcoin has left a bitter taste in their mouths and they are not willing to walk down that road again just yet.