Coinbase Commerce Removes Native Bitcoin Payment Support for Merchants – What’s Going On?
Coinbase has made the decision to remove support for native Bitcoin (BTC) and other UTXO coins on its payment platform for merchants, Coinbase Commerce. This move is driven by challenges in delivering updates on Coinbase Commerce’s EVM payment protocol for Bitcoin.
Coinbase Commerce Adds Support for New Assets
The new Coinbase Commerce product focuses on enforcing payment details on-chain and supports a wide range of assets, including native and ERC-20 tokens. It also automatically converts payments to USDC (USD Coin) on-chain at a guaranteed rate for merchants. However, providing the same capabilities on the Bitcoin blockchain without smart contracts and stablecoins posed significant challenges, leading to the removal of native Bitcoin and UTXO support.
- Customers using Coinbase accounts can still use Bitcoin as a payment option.
- Coinbase is working on integrating the Lightning Network into its platform, which could open up opportunities for Lightning Network-based commerce payments in the future.
Crypto Payments to Move to L2s: Armstrong
Coinbase CEO Brian Armstrong emphasizes that the mainstream adoption of crypto payments relies on moving away from layer-one solutions to reduce transaction fees and confirmation times. He believes that paying with crypto will primarily happen on Layer 2 in the future.
- The Lightning Network is a payment protocol designed to facilitate transactions within the Bitcoin blockchain.
- Armstrong’s goal is to accelerate the move towards a world where crypto payments occur on Layer 2.
The decision to remove native Bitcoin support has sparked criticism within the community, with concerns raised about its impact on Bitcoin adoption. Critics argue that assuming every customer has a Coinbase account or is based in the United States may limit broader acceptance.
This development comes shortly after Coinbase announced a 64% jump in transaction revenue in its quarterly report.
Hot Take: Coinbase Commerce’s Removal of Native Bitcoin Support
The removal of native Bitcoin support by Coinbase Commerce raises questions about the future of crypto payments and highlights the challenges of integrating different blockchain protocols. While Coinbase Commerce focuses on supporting a wide range of assets, the limitations of the Bitcoin blockchain without smart contracts and stablecoins have led to the removal of native Bitcoin and UTXO support. This decision has drawn criticism from some who argue that it may hinder broader adoption of Bitcoin for commerce. However, Coinbase’s integration of the Lightning Network shows a commitment to exploring solutions for faster and more cost-effective crypto payments.
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