Bitcoin price surge leads Steam to stop taking it as payment

The cryptocurrency was intended to replace cash, but now can't be used to buy things on one of the internet's biggest shops

Bitcoin (virtual currency) coins placed on Dollar banknotes, next to computer keyboard, are seen in this illustration picture, November 6, 2017 (REUTERS/Dado Ruvic)

Bitcoin is becoming so valuable and volatile that it's not possible to use it to actually sell things, according to one prominent online shop.

Steam – which is the primary way of selling computer games on the internet – says that it will no longer accept the cryptocurrency because of its swift and shocking changes in price.

Over the last week, Bitcoin has surged through previous records amid an unprecedented increase in its value. The price has risen more than 100 per cent over the last month, and as much as 1,800 per cent in the last year.

But those same surges have been accompanied by huge dips, with days where the price has dropped by as much as 25 per cent. That volatility has led many to invest in the cryptocurrency – but shops now say it is becoming difficult to know how valuable it is when exchanging goods for bitcoin.

The changes can be so quick that the value of bitcoin can vary hugely even in the time that it takes to complete a transaction.

That is accompanied by significant transaction fees that make selling things in bitcoin doubly expensive. The bitcoin network charges shops when they sell things using bitcoin – meaning that they can be landed with bills of as much as $20 per transaction when selling.

Those two problems have led Steam to announce that it will no longer support the cryptocurrency as a way of buying things online. "As of today, Steam will no longer support Bitcoin as a payment method on our platform due to high fees and volatility in the value of Bitcoin," it said in a blog post.

If the price and network supporting bitcoin becomes more stable, it might bring back support. But for now people will have to pay in more traditional money, it said.

"At this point, it has become untenable to support Bitcoin as a payment option," the blog post read. "We may re-evaluate whether Bitcoin makes sense for us and for the Steam community at a later date."