On February 4, BitPay, the leading Bitcoin and crypto payment services provider, said that it would soon enable and support invoices to get paid from any Bitcoin wallet or exchange. BitPay CEO Stephen Pair explained this decision. He said that the decision to facilitate merchant payments from any BTC wallet was supported by merchant feedback.
Hence, it will put control back in the hands of at least 30,000 active merchants currently using BitPay:
“BitPay’s customers want to support all the Bitcoin wallets, just like they want to support all cryptocurrencies for payments. The company has decided to re-enable support for all wallets, which is referred to as plain vanilla peer-to-peer transactions.”
Pair said that a phased rollout to support all Bitcoin wallets has already started. After this feature is implemented fully, merchants can decide which wallets they can accept payments from. On the other hand, consumers can use any wallet to make purchases from these merchants.
According to the CEO, merchants can take advantage of peer-to-peer transactions without any needed technical development or implementation, highlighting:
“We are going to automate the whole process for merchants since we already have experience doing this. Merchants need to support all Bitcoin wallets, as this will greatly expand their potential to grow sales and acquire new customers.”
BIP70 payment protocol
This decision to restore services to all the Bitcoin wallets comes after BitPay went on a rocky path towards success. When the BTC price was heading towards its all-time high in December 2017, Pair said that BitPay was encountering delays. These delays affected about 9% of the customer payments.
He revealed that several customer support issues were being reported at that time. These challenges pushed the company to implement the payment protocol called “BIP70.” He added:
“At times, Bitcoin has been a victim of its success. As adoption exploded in 2017 and 2018, network congestion and high transaction fees brought with them some tough decisions, like the one to implement Payment Protocol for all Bitcoin payments.”
While this BIP70 eliminated network congestion, it limited users to particular Ether, Bitcoin Cash, and Bitcoin Wallets. BitPay users complained in a 2018 Reddit post that payments could never be completed using some of the popular wallets like Bitcoin and Coinbase Wallet.
BitPay JSON protocol will remain
As BitPay starts to add support for all the Bitcoin wallets, Pair explained that the platform would continue to implement and use the JSON payment protocol,
“As we have many wallets in the pipeline looking to support that”
He further said that BitPay launched its JSON payment protocol in February 2018 together with BIP70 due to customer support issues. This JSON payment protocol resulted in reduced error rates to almost 0% at that time.
The dollar volume lost to crypto payment errors plunged rapidly. It moved from more than 8% in December 2017 to below 1% of BitPay’s total dollar volume processed. One company blog post stated that the interface offers direct communication between BitPay’s servers and a wallet, noting:
“If a wallet submits an incorrect payment to BitPay, BitPay’s servers will reject the transaction. This prevents any transactions which will result in a failed payment from reaching the Bitcoin blockchain and costing users unnecessary miner fees. We expect that this change will allow us to reduce payment errors to zero.”
In the case of the wallets that support regular Bitcoin or Bitcoin Cash transactions, Pair added that BitPay expects to encounter fewer payment errors and exceptions moving forward:
“Merchants have increased opportunities for sales from millions of global wallet holders that have not implemented the payment protocol and consumers have more places to make purchases. As a result, mainstream adoption for Bitcoin and cryptocurrency is on the horizon.”
Will this move result in mass adoption? Time will tell.