Ripple CTO David Schwartz recently joined a conversation ignited by longtime Bitcoin advocate Bruce Fenton about why Bitcoin is not actually used in daily transactions.
Fenton, CEO of Chainstone Lab, pointed out about 10 years ago that BTC can actually be used for regular purchases. He said in 2015 that more than 130 restaurants in Portsmouth, New Hampshire were accepting Bitcoin. Even the main crypto conference, Satoshi’s Roundtable, paid more than 70% of ticket sales in Bitcoin at the time. But now those numbers are close to zero.
Fenton sees this decline as a failure. He insists that money must be used in transactions, not only be held as an investment. “Using Bitcoin for purchases is a great way to grow your network,” he said.
Why are few people using Bitcoin? Ripple CTO explains
Many people believe that Bitcoin’s high fees and slower transactions make payments unrealistic. Bitcoin user Mandrik suggests that people now see it as a long-term asset. “They look back five years later and don’t want to regret spending $5,000 on a cheeseburger,” he said.
Ripple CTO David Schwartz claimed that Bitcoin worked for payments when people didn’t consider it real money. He added that when early recruits got it very cheap, Bitcoin was primarily used for payments. As its value increased, fewer people wanted to use it.
“When the supply of early miners who got Bitcoin almost free had dried up, there was no more reason to pay with Bitcoin.” Schwartz said.
Meanwhile, early Bitcoin supporter Jack Mehoff reflects Schwartz’s perspective. He once said he paid for beer, tacos and coffee in BTC. But in the end, the rising costs and slower speeds made it all too cumbersome.
Schwartz also pointed out that there are many other cryptocurrencies out there that are low transaction costs and faster speeds. However, as he pointed out, “I don’t use that much either. At least not yet.“
There are lots of low cost and fast ciphers. I don’t use that much either. At least not yet.
– David “Joelkatz” Schwartz (@Joelkatz) March 19, 2025
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Bitcoin payments have become stricter due to regulations and banking regulations
Some experts believe that the decline in Bitcoin as a payment method is more about regulations than technical restrictions. Wayne Vaughn argues that tax laws and bank restrictions have made Bitcoin payments difficult.
“The tax treatment of Bitcoin is a major barrier. Companies that accept Bitcoin face a significant accounting burden and banks have been very hostile,” he said.
Dave Weisberger agrees that Bitcoin is too expensive as Capital Gate charges taxes. “All purchases increase effectively by 24% due to capital gains tax,” he explained.
Sam Jones added that tax exemptions for small Bitcoin transactions, similar to the foreign currency rules, could encourage more spending.
Some blame the Lightning network for failing to fulfill its promise of cheap and fast transactions. Meanwhile, some argue that Bitcoin’s main role has shifted to stores that are as valuable as gold.
Related: Veteran investors break down the bull run of Bitcoin: miners, investors, and what to expect next after price
Even with regulations amendments, there is a question of whether Bitcoin payments will compete with traditional methods. Anders, a financial advisor, believes Fiat is a more convenient option. “People aren’t going to use Bitcoin if they create worse payment experience,” he said.
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