Bitcoin, the digital asset that has struggled to catch on with the general public, will no longer be accepted at Microsoft’s Windows Store.
“You can no longer redeem Bitcoin into your Microsoft account,” Microsoft wrote on in the Windows Store FAQ page. “Existing balances in your account will still be available for purchases from Microsoft Store, but can’t be refunded.”
The move marks a relatively rapid change of heart for Microsoft. It was only 15 months ago that the company announced it had arranged for Bitcoin users to buy apps, games and videos from its online stores.
Back then, Eric Lockard, corporate vice president of Universal Store at Microsoft wrote: “For us, this is about giving people options and helping them do more on their devices and in the cloud. The use of digital currencies such as Bitcoin, while not yet mainstream, is growing beyond the early enthusiasts. We expect this growth to continue and allowing people to use bitcoin to purchase our products and services now allows us to be at the front edge of that trend.”
Microsoft has yet to specify why it stopped accepting Bitcoin, but the question being asked now is whether Lockard and Microsoft were overly optimistic about the “trend”?
Last summer, an Expedia executive revealed that a year after the travel-booking site began accepting Bitcoin, purchases using the currency were down 40 percent. Why Bitcoin may be struggling to gain popularity is unclear but it has struggled with several important factors, including technical issues.
According to a report in The Register, there are reports that “transactions in the script are taking as much as a dozen hours to settle.”
In Russia, lawmakers are considering an outright ban of Bitcoin that could also require fines and jail time for anyone transacting with the currency.
In December 2014, when Microsoft announced it would accept Bitcoin, it was hailed as a huge boost for the currency’s credibility. Microsoft was the largest company to adopt it to that point. But even then, Microsoft’s Bitcoin offer was only a baby step.
Microsoft never accepted Bitcoin payments directly. The software company contracted with BitPay, a payment processor, and it was that company that accepted Bitcoin and then transferred cash to Microsoft. The same goes for Expedia and many of the other companies that advertise accepting Bitcoin.
The currency appears to have a long way to go before it becomes a legitimate rival to dollars.