Coinbase removes Bitcoin payments from merchants’ platform

Coinbase Commerce, the payment platform for merchants, has made the decision to remove support for native Bitcoin and other UTXO (Unspent Transaction Output) coins. This move was announced by Lauren Dowling, the company’s head of product, who cited difficulties in delivering updates on its EVM (Ethereum Virtual Machine) payment protocol for Bitcoin. The new Coinbase Commerce product now enforces onchain payment details and supports a wide range of assets, both native and ERC-20 tokens. Payments made through Coinbase Commerce will be automatically converted to USDC (USD Coin) onchain at a guaranteed rate for merchants. Customers using Coinbase Commerce can still use Bitcoin if they have an account with the exchange.

Brian Armstrong, the CEO of Coinbase, mentioned that the company is currently working on integrating the Lightning Network into Coinbase. This means that in the future, there may be opportunities for shoppers to make commerce payments using Bitcoin through the Lightning Network. The Lightning Network is a payment protocol specifically designed to facilitate Bitcoin transactions within the blockchain. It has been in operation since 2017.

According to Armstrong, mainstream adoption of cryptocurrency for online payments will only occur once transaction fees and confirmation times are reduced. He believes that moving away from layer 1 and embracing layer 2 solutions, such as the Lightning Network, will help accelerate this process.

The decision to remove native Bitcoin support from Coinbase Commerce has faced criticism from the community on social media. Some users argue that this move hinders Bitcoin adoption as it assumes that every customer is based in the US and able to open a Coinbase account. They argue that this restricts merchants who simply want to accept Bitcoin payments without requiring their customers to have a specific type of account.

It is important to note that Bitcoin utilizes the UTXO model, while Ethereum follows an account model. The UTXO model is designed for transparency and security, whereas the account model offers more flexibility, similar to traditional bank accounts.