Feature Friday: Accept Bitcoin With Stripe

Stripe has had this in beta for quite a while but yesterday they launched it and now any merchant who is using Stripe can accept Bitcoins in the regular Stripe checkout flow.

Here’s the details on how it works and there’s a nice interactive demo on this page.

If you are using Stripe to handle your checkouts, just add a few things to your Stripe code and you are good to go.

It’s things like this, making it drop dead simple for merchants to accept Bitcoin, that will help drive adoption of Bitcoin payments in the coming years.

And accepting payment with Bitcoin via Stripe costs a merchant 0.5% vs the customary 3%. For low margin products, this is real money. I expect merchants will start incenting customers to pay with Bitcoin in certain product sectors.

I’m going to go find some Stripe merchants that are accepting Bitcoin and try out the checkout flow. It looks really smooth and clean, like everything Stripe puts out.

#hacking finance

Comments (Archived):

  1. William Mougayar

    It doesn’t make sense to pay for anything under $10 with a credit card. That territory is perfect for Bitcoin. From a merchant’s point of view, the transaction fees on small payments are a killer.2 days ago, I participated at a Bitcoin panel, and one of the final audience question was – “Will we see Walmart accept Bitcoin in the next year?” My answer was: “We will see special check-out lanes that accept only Bitcoin, and especially for under $10-15 in total.” I make that prediction not just for Walmart, but any large store will have that, same as they have the under 8 items fast lane.

    1. pointsnfigures

      Other competitors there using Fiat currency. Venmo, Dwolla. Agree, this is where bitcoin can make inroads (Starbucks maybe?), but the currency needs a stable ecosystem with a way to hedge. That’s not there yet.

      1. William Mougayar

        Maybe there will a crypto/Alternative payments lane all together.

      2. andyswan

        I would love it if places started accepting Venmo for small purchases. I’ve been on venmo for years… did lots in transactions on it in 2014. My only user experience with bitcoin was shorting it via some hong kong exchange that I wasn’t comfortable keeping money in.CoinBase could change that.

      3. BillMcNeely

        Thanks for mentioning Venmo. I have tip hanging there and I could not remember which service it was with.

    2. Kirsten Lambertsen

      In the next year?

      1. William Mougayar

        most probably. For Bitcoin/Crypto, it’s dog years. Every 3-4 months is one year 🙂

        1. andyswan

          I’ll take the other side of that wager… in any currency and amount you want!

          1. William Mougayar

            only if we can run that as a smart contract wager on Ethereum 🙂

          2. andyswan

            I’m checking it out now and loving what I see. Instantly thinking of a zillion ways to use it with what we do. I’m gonna reach out to you next time I’m NYC bound we should chat

          3. pointsnfigures

            or Toronto. He’s a Maple Leafs fan.

          4. PhilipSugar

            I just commented above and that was exactly what I thought in my mind. I almost wrote it but thought I don’t want to be too aggressive, but I’ll even go 2 to 1

          5. William Mougayar

            Well look what Walmart is doing now. I just talked to them.

        2. Kirsten Lambertsen

          Wow. That kinda blows my mind! Can’t wait 🙂

    3. BillMcNeely

      You know who would speed Bitcoin adoption? The independent immigrant owners of convenient stores in the US.How many times have you been told in one of these places we don’t take credit or debit card for less X dollar purchase?

      1. William Mougayar

        True…and they can prob also send remittances overseas easily, if they wanted to.but someone needs to on-board them.

    4. Richard

      I havnt been to a Walmart in sometime, but what percentage of walmart customers even know what bitcoin is? Their consumer base is still using private label credit cards.

    5. PhilipSugar

      I usually agree but Walmart is not going to accept Bitcoin anytime soon.

      1. William Mougayar

        It was partially-wishful thinking on my part, but you never know. Dell is going all in with Bitcoin (also powered by Coinbase). And I remember one day in 1996 when Dell passed the $1M/day mark in e-commerce on their website, and it looked like a fluke. You never know.

        1. Girish Mehta

          Ah, memories…I was with Dell when we crossed that $1M/day mark in online sales in 1996. I still remember – for a couple of weeks after that, it was all anybody in the external community/analysts would talk about. Yesterday Dell became the largest company internationally to accept bitcoin with the addition of the UK and Canada.p.s. I used to say later – something about that Dell $1M/day online number in 1996 stuck as a marker…even though the industry (and Dell) moved so rapidly past that. So – its interesting to see you mention that nearly 20 years later. Like the Netscape IPO in 1995 (a much bigger event)…many blockbuster IPOs after that leading up to Alibaba last year…but that day in August 1995 when Netscape IPO’d remains a marker.

          1. William Mougayar

            Wow. that was a key day in the history of early Internet e-commerce.

          2. Girish Mehta

            Yes, it sure was.

        2. Vasudev Ram

          > in 1996 when Dell passed the $1M/day mark in e-commerce on their websiteHa ha, I remember some of the early days of Dell selling online, if not that exact year. Used to read BYTE magazine cover to cover, and there were usually full-page Dell ads on the inside or back covers, advertising their really low prices on various PC models/configs, sometimes with (fun) speech balloons, that said something like: “[Dell] Can we go any lower than this?” and then “[Customer] Give it away FREE]”.Never bought one then but I have one now, and it has been working well.

    6. Richard

      It is 75% of starbucks business

  2. andyswan

    I understand why the merchant would like this (lower fee, no chargeback risk).Why would I, as a customer, prefer to pay with bitcoin rather than my Amex (which gives me a reward and purchase insurance)?Thanks in advance.

    1. Jason T

      And as soon as companies start popping up to provide these services (purchase insurance, rewards, fraud protection, etc), it no longer costs only 0.5% to merchants. Therein lies the problem. Simply building bitcoin into POS systems costs 0.5% apparently.

      1. andyswan

        Agree 100%. People that think CC companies are charging 2.5% to move digital dollar from A to B are deluding themselves. There’s soooooo much more value there.

        1. Richard

          Yep, it is the “credit” card.

        2. PhilipSugar

          I agree. This does not mean there could be a more efficient way to run credit card companies (I am in DE, the land of credit cards and see their operations)But for instance Citi provides the customer 2% cash back so essentially the fee is .5%There is another thing. For those of us who have enough money in our bank accounts paying cash or credit doesn’t really matter (except that I like the 2%), but we are not the majority.I had a really senior exec at a credit card company tell me this over cocktails:”Yes people like Walmart hate us, but guess what?? Do you know what their sales of big screens would be this week if people had to have enough money in their bank accounts to buy them??? (it was Thanksgiving) Less than half. The whole damn U.S. supply chain breaks down if it wasn’t for the fact that we facilitate and lubricate consumer consumption which is 68% of GDP”

          1. LE

            I had a deadbeat tenant (guy had a business a fitness studio and wasn’t doing well and kept making excuses) who couldn’t pay the rent. I finally thought “hmm I will just offer to let him pay by credit card”. He had been deposited cash right into a designated bank account (no “check in the mail bullshit”). I didn’t want to run it through the business account so I setup a new paypal just for him. He then paid by credit card and also I charged him 3% more (and late fee) because that was what the paypal was costing me (and he didn’t balk at all). [1] Now the risk has been shifted to the credit card company.The risk shift is important and “buy things you can’t afford” is a net win for the economy for sure. It has greatly increased the amount of goods sold and lowered the price for the rest of us. Why I always say that even though I don’t celebrate Christmas it’s a great holiday. People buying things they can’t afford (with credit cards) lowering the cost of goods.[1] I would have easily let him off the 3% extra but he never asked.

        3. kev polonski

          I think the real value of Bitcoin will be realized when the industry realizes that bitcoins will not and should not attempt to replace the vast majority of payment transactions but instead find new ways to enable micro-payment based business models. One example – to combat spam in email using bitcoin/blockchain enabled trust relationships.

        4. Matt Zagaja

          And so many people don’t get that! Yesterday a friend’s friend on Facebook started going on about how he only uses cash and people should only use cash and credit cards are going to cause me to waste money. A strange series of maxims probably being parroted from one of the financial empowerment people on TV or radio. I keep cash on me but almost always prefer to use my card. A year or two ago the keyboard on my MacBook Pro broke. It was out of warranty but as a courtesy the Bank of America VISA extends warranties for a year (most cards do this now) so all I had to do was submit the paperwork from Apple to the insurance company and they cut me a check.Ironically the purchase of the same computer accidentally caused me to go a couple dollars above my credit limit. A call to the card company asking for a little forgiveness is all it took and the pleasant customer service rep waived $40 or so in fees.

      2. William Mougayar

        maybe it will stay under the radar for small dollar items.

          1. William Mougayar

            oh no! but is that related to Bitcoin 🙂

          2. LE

            Speaking of random associations, I was just thinking that under the rules of “marsha marsha marsha” the more Fred writes about something (“marsha” is bitcoin in this case) the more you have to wonder which end of the bell curve that subject is at investment wise.Doing well and meeting expectations: write about it.Not doing well and behind expectations: write about it.https://www.youtube.com/wat

          3. William Mougayar

            It’s still pretty early days, circa 1994-95 internet days, with even more initial chaos, crooks & idiots going into it.

          4. Kirsten Lambertsen

            This literally made me sad. I hope it doesn’t hurt their biz. It’s one of my very favorite places in nyc.

          5. LE

            Back when TV’s were big and heavy my sister had a TV in her bathroom mounted like they do in hospitals on the wall. (Was my brother in law’s idea). One day she came home to find the heavy tv shattered on the floor in the bathroom. Luckily nobody was there at the time.Obviously in the case of my sister (and this restaurant) whoever mounted it didn’t use the correct mounting hardware.

    2. Boling

      This is a step in the right direction. It’s going to take a lot of merchant effort to drive bitcoin adoption. Fortunately, Bitcoin is now a complete no-brainer for merchants.There are pieces of the existing consumer payments stack that bitcoin is still missing. However, the advantage of bitcoin is that as these pieces get rebuilt for bitcoin, they’re going to be built with modern technology, unencumbered by 30 year old legacy systems. If you’ve ever worked on issuing cards you’ll know how outdated and terrible these systems are (even the “modern” ones).It costs 0.5% to “build bitcoin into POS systems” right now, but there’s no infrastructural reason why this couldn’t be 10x lower – just wait til Braintree, Balanced and WePay roll out the same thing.

      1. fredwilson

        that’s not exactly right. fraud and compliance are real costs for those who process bitcoin transactions. bitcoin payments are not free. but they are dramatically lower cost than credit card payments. i think competition may drive the 0.5% down but i am not sure how much lower it can go given the real costs to providing that service.

        1. LE

          fraud and compliance are real costs for those who process bitcoin transactionsDoes the word “fraud” belong in that sentence? Compliance and other costs of doing business yes of course.I guess you have me confused now. Everything I thought, confirmed by this [1] seems to indicate that risk of fraud is on the buyer not the other parts of the transaction chain (not talking about hacking of course). Maybe I’m missing something.[1] http://www.quora.com/What-a

          1. Boling

            Coinbase (or any bitcoin processor) takes on ACH fraud risk when converting the btc they accept back to usd.

        2. Boling

          Ah yeah- very true. Costs of doing business in this space…

    3. fredwilson

      a merchant can provide incentives for you to do that. some will.

      1. andyswan

        Doesn’t that generally put them in violation of their existing CC agreements?  I’ve always had to agree that I will not incent other forms of payment. I agree though…there are things merchant can do and 2% is a significant savings.  Long way to go but love seeing Stripe lead.

      2. Derek Webster

        But, at most, it would only be sustainable for the merchant to offer 100-200 bps of value/incentive to the consumer to do so? 100-200bps isn’t a 10x better incentive to cause consumer to change behavior. (I already get 100-200 bps of value due to credit card rewards programs, anyway – although that’s unique to the US market)I completely understand the use case with small ticket txns and cross-border, but for everyday retail I haven’t felt the value prop as a consumer.

    4. Greg Kieser

      If people have a choice to pay that much less for products, I imagine they will skip the benefits of complicated to redeem rewards and rarely useful insurance.The beauty of it: if bitcoin does in fact take over the last mile for payments, it will be an incredibly competitive environment to provide those additional perks you like.

      1. andyswan

        It’s insanely competitive now.  CC companies are spending shitloads to try to get my business, and offering incredible rewards.

        1. LE

          Yep Capital One sent me a card offer on a business card of 2% back with no limits and $500 for spending $4000 within 3 months. I thought there was a catch [1] but there wasn’t. Got a rewards check for over a thousand already. I put everything I can on that card now.[1] I shred these offers on a weekly basis as I’m sure everyone does because I never got, until Capital One, something better than what I already had.

      2. LE

        If people have a choice to pay that much less for products, I imagine they will skip the benefits of complicated to redeem rewards and rarely useful insurance.Won’t happen. A 2% kickback is a much greater motivator than a 2% discount in cost. Plus a 2% discount in cost doesn’t appear to be a big deal even if it is laid out when you purchase. Rewards at 2% otoh pile up like marble kids earn for good behavior.Also with rewards it’s “found money” and people respond to that bump much better than they do a discount (of a nominal amount) in real time. People are already conditioned (by sales) to expect much higher cuts than 2 or 5% they start to get motivated north of 20% and higher.

        1. Greg Kieser

          Not every customer segment will go to bitcoin, for sure.But not everybody has a cushion of money each month or the wherewithal/desire to shop for and collect rewards. A lot of people don’t care about rewards. A lot of people don’t have credit cards, or bank accounts. Many of those who and live close to the margin (paycheck to paycheck) are constantly getting dinged for going over the limit or into overdraft. I’ve been there.For a big segment of the population in the US the above is a reality and bitcoin will make life easier for them and allow them to participate in the electronic economy at a significantly lower cost.

    5. awaldstein

      Conceptually Bitcoin is genius. Possibly in its implementation as well.Realistically the consumer doesn’t care–and most likely won’t.So if this is b2b type of wedge to crack the status quo it should be pretty clear of the why of it.Big Stripe fan. But something is missing here that makes me want to embrace this more than I do, beyond being just curious.

  3. pointsnfigures

    Love Stripe. Developers I know love integrating with Stripe too. Easy, simple.

    1. Chad Kruse

      “Easy, simple” is an understatement! It only took us one line of code (bitcoin: ‘true’) to integrate Bitcoin payments into our existing Stripe setup. That’s only 15 characters!Fred (and fellow AVC’ers)…if you haven’t found a live example but want to see the workflow, I’ve set up a $1 test button for AVC Guests: https://kyn.me/series-awesome(Your $1 will go directly toward our work in gender equality)

      1. fredwilson

        that’s cool

  4. Seth M Phillips

    Cool. I’m sure this opens up a ton of new merchants. Who is taking the FX risk for Stripe? I assume Strip isn’t stacking up coin in a cold-storage wallet. Is Coinbase taking Stripe in and out of bitcoin? Bitpay? Or did they design their own

    1. fredwilson

      yes, its stripe frontending coinbase

  5. Mike Zamansky

    I always loved the fact that with Stripe Checkout you can be up and running in a matter of minutes. It looks like it’s a little more work to “roll your own” but no worse than doing so with stripe and credit cards which is still very easy given their docs.Then again, Coinbase integration is also pretty straightforward.

    1. fredwilson

      coinbase is the backend of the stripe bitcoin service

  6. awaldstein

    I need to look at their implementation.I’m a big Strip fan having built two systems on their platform.

  7. jusben1369

    I keep saying that Bitcoin is similar to Linux. I remember all that energy and excitement around how Linux would take over the desktop based on how much it cost to license/run Windows or MacOS. Yet the real area that Linux disrupted was the back office/network where it took substantial share first from Sun then from WindowsNT servers. I don’t see Bitcoin ever doing much on the consumer side (low margin merchants like Overstock.com aside) but I do think the underlying blockchain technology could really change the money networks.

    1. fredwilson

      yes, but android is based on linux.

      1. Seth M Phillips

        I still like the analogy. Linux as the foundation for android is like the blockchain as the rails for all kinds of applications.

        1. jusben1369

          Yes Fred I think that example and Seth’s comment are spot on. It’s still foundational vs end users interacting or knowing it’s there.

      2. LE

        My treadmill runs android. It’s super annoying and slow to startup. The old one with the embedded controller (from the same company) was quick. The new one needs to follow a sequence just like a computer does. Nice touch. I hate it. If you hit to many keys out of sequence you need to literally reboot it.http://www.androidtablets.n

  8. BillMcNeely

    Mmm. I just set up class How to Run a 5 Star On Demand Driving Business on Meetup http://www.meetup.com/Dalla…Accepting Bitcoin would put extra money in my pocket.Maybe the following week I will try to set up my own site using stripe to collect.

  9. Inna Raykhman

    how are they converting bitcoin to usd or another currency? at what rate? are they using a some bitcoin exchange?

    1. fredwilson

      yes, coinbase is doing that

      1. LE

        Interesting the first thing I thought when I saw this yesterday was “what does this mean for coinbase”. But I’m not seeing any mention of coinbase anywhere maybe I missed it.

  10. LE

    It’s things like this, making it drop dead simple for merchants to accept Bitcoin, that will help drive adoption of Bitcoin payments in the coming years.Isn’t there, instead of this (graphic attached) a way for onename.com to work there way into this simplicity?

  11. Josh Gordon

    0.5% is an awesome rate. But the rest of their rates are not: 2.9% + 0.30 is steep and I presume they make up for lower revenue in bitcoin here. I wonder if it’s possible to integrate them just with bitcoin, while using another API for credit card companies.

  12. Emily Merkle

    that margin is such a huge factor in retail, grocery, bodega – ascending. my guy around the corner won’t take credit because of it.

  13. Tom Labus

    If you have any amount of order flow, there are always a number of transactions that get bumped to 5%. Simple and customer incentives are always good.

  14. Matt Kruza

    Interesting everyone realizing that bitcoin isn’t really much cheaper for the pure payment processing side (its interchange fees folks – basically 1.5-2% of the 3% and this is used for rewards… which is still dumb.. but people like them.. really hard to change that). I have said this in at least 10 quotes on bitcoin and why it won’t be that disruptive. The underlying blockchain maybe (don’t know it enough to comment for sure) but bitcoin is a fad

  15. JimHirshfield

    I like your advocacy of the bitcoin space and startups in it, even those you’re not an investor in…’cause a rising tide lifts all boats, right?

    1. fredwilson

      well you are assuming something that is actually not accurate

      1. JimHirshfield

        I guess I missed the announcement that you invested in Stripe. :-/

        1. fredwilson

          there are some investments we have not announced. that’s all i am saying on this topic.

          1. JimHirshfield

            Non-announcement announcement, just sayin’ not sayin’

          2. LE

            Hmm, maybe this could be something like Strip is acquiring coinbase then. Doesn’t dove tail with Fred’s remarks though.

          3. LE

            people read way too much into my blog posts, ascribing meaning to them that does not exist in my brain.From all appearance you don’t come across as devious in any way that is for sure. I was raised to read the tea leaves and your transparent behavior on this blog is a constant source of frustration to my brain. Very unusual in business, from my experience.

          4. Richard

            Count on paypal being involved in some aspect of m&a here.

          5. LE

            I noticed that you seemed especially happy one day within the last week. Usually when that has happened in the past there was something you had up your sleeve.

          6. fredwilson

            if that is true, it was not work related

  16. Kirsten Lambertsen

    I feel like Bitcoin is a mouse in a maze and we’re all watching it, waiting for it to find the escape hatch outta there. What is the escape hatch application/consumer that’s going to bring it to the masses, I wonder.As a consumer, I’m personally not motivated enough right now to bother. For example, I make little scrubby $1.99 purchases over a Comixology.com every week. They run it through my Amazon acct, which is just ridiculously easy and convenient. Seems like a small amount like that is the right target for BC, but there has to be a way to make it so easy for me the consumer that the allure of the Amazon payment is actually overshadowed.

  17. cdh195077

    I must agree with Andyswan about purchase insurance and what happened if anything go wrong?