Online payments company Stripe Inc. is venturing back into the cryptocurrency space after dropping support for Bitcoin four years ago. The company will begin to offer merchants the option of paying users in cryptocurrency. The rollout of cryptocurrency payments begins on Friday, April 22 with Twitter, Inc. (TWTR), before eventually expanding to other merchants.
For now, Stripe will only allow payments to be made through the stablecoin USD Coin (USDC).
Stablecoin USDC Selected First
Twitter will be the first company to utilize Stripe's new cryptocurrency payment method. The social media company will provide certain users with the option to receive earnings from its paid Super Follows and Ticketed Spaces features in USDC.
Stripe's decision to allow merchants to pay users in cryptocurrency is company's the first move into the crypto space in several years. In January 2018, Stripe stopped accepting payments in Bitcoin, saying that the tokens volatility and lack of efficiency made it a poor choice for everyday transactions. As a stablecoin, USDC is pegged to the U.S. dollar, providing it with more price stability than Bitcoin and many other crypto tokens.
More Options Likely to Come
Since giving up Bitcoin functionality, Stripe has more recently explored Web3, a movement aiming to decentralize the internet using blockchain technology. The company created a team in 2021 dedicated to exploring Web3 and cryptocurrency options. Now, Stripe says that it will likely add support for additional payout cryptocurrencies in the future.
Stripe is not the only payments company expanding its platform to include digital tokens. PayPal Holdings, Inc. (PYPL), Mastercard Incorporated (MA), and other major payments services companies have all previously announced that they will move into the cryptocurrency space.
How is Stripe using cryptocurrencies?
Stripe will now allow merchants—beginning with Twitter—to offer payouts to users in the cryptocurrency USDC.
Why does Stripe use USDC?
USDC is a stablecoin that is backed by the U.S. dollar. This means that it has price stability not necessarily found in many popular digital tokens. Stripe cited Bitcoin's volatility as one reason the payments company discontinued payments in cryptocurrency in 2018.
Can Stripe users pay in cryptocurrency?
For the time being, Stripe has only added cryptocurrency functionality allowing merchants to make payouts to users in USDC.