Although more people are interested in Bitcoin now than ever before, most of them are interested in it as a speculative or trading asset instead of using it for purchases and payments.
For instance, Google Trends reveal that most people are now interest in holding cryptocurrencies for sale at a profit in future. Additionally, very many apps now focus on speculating and trading cryptocurrencies rather than making payment with it.
Also, some Bitcoin-focused companies are changing their focus from that of accepting merchants or providing merchant services to that of helping more people to invest in and trade the cryptocurrency. An example is Coinbase, which has temporarily halted registration for merchants. Report by Recode says Coinbase was the most popular app in the Apple app store.
But price trends are the most significant reason why some more would want to accept or not accept Bitcoin payments. When prices are high, and there is speculation that it will go higher shortly. Thus, more people would want to take it as payment because they are looking for profits. Problems starts when there is no forecast of an increase in price shortly. Therefore, by nature, Bitcoin is a speculative tool even for most people willing to accept it as a payment method.
Bitcoin’s price volatility and a decline in the recent past is causing more merchants to abandon allowing their customers to buy products with it. The reason was by Microsoft, Steem, and Stripe as they halting merchant services for Bitcoin. Internet Retailer shows that the cryptocurrency accepts only by top 500 online merchants. This is 5 percent lower than the number who were taking it as payment last year.
Morgan Stanley payments analyst James Faucette wrote last Wednesday in a report,
“Bitcoin owners are reluctant to use the cryptocurrency given its rate of appreciation, more evidence that bitcoin is more asset than currency. Way easier to trade speculatively than convince new merchants to accept the cryptocurrency”.
The reluctance of Bitcoin merchants to accept is as payment also hinges on other problems on the network currently. For instance, the transaction processing is slow and costly. More costly transactions have seen it grow undesirable especially for micro-transactions.