Bitcoin’s merchant adoption has actually gone down this year, according to the Bitcoin ABC lead developer.
In an episode of BitTopia, Amaury Séchet mentioned Bitcoin merchant adoption and its present status. He sees a decline in adoption in 2017, with more and more merchants formerly comfortable with supporting Bitcoin now choosing to no longer do so. The connection between this trend and ongoing high fees is fairly clear as merchants no longer find it viable to accept Bitcoin transactions for smaller payments, and consumers no longer finds the novelty of the transaction to be worth the fees.
Transaction fees became higher than credit card fees in 2017
While on a gradual increase for long before then, Bitcoin fees began to grow to unsustainable levels in 2017. At the beginning of the year, the median fee was 17 cents and the average fee was 35 cents, both no longer at a clear advantage over card processing fees for regular small transactions. By mid-April the median fee passed 50 cents and the average fee was over $1, now firmly less efficient for small transactions. By mid-June the median fee was over $2.50 and the average fee was approaching $5. At present, despite a large exodus of transactions to other chains including Bitcoin Cash, and the recent activation of Segwit, the average fee is still over $5 while the median fee is over $3.
The result of this fee structure is that Bitcoin is an untenable solution for most regular purchases, and only makes sense for larger transfers of wealth. More importantly, even where competitive with other transaction methods, the former “Bitcoin advantage” no longer exists. This was previously a selling point for merchants to adopt the digital currency, and without that incentive many simply choose not to put the effort towards adding a new feature.
Main street adoption for a digital currency won’t happen without low fees and fast transactions
As the rest of the digital currency world searches for an alternative for regular transactions, Dash maintains a strong adoption lead, currently ranking 316 businesses worldwide listed on DiscoverDash, a rapidly growing figure as more merchants come on board after having waited out Bitcoin for too long. The median transaction fee is currently at 2.6 cents, set to be reduced in the coming months.
In addition, over the next year the Evolution release will provide a much cleaner and user friendly experience on the protocol level, providing an additional incentive for merchants weary of previous issues with digital currency to switch.