JAKARTA - Coinbase has removed support for Bitcoin and other UTXO coins from its payments platform for merchants, Coinbase Commerce, according to the company's head of product, Lauren Dowling.

In a February 18 thread on X (formerly Twitter), Dowling said the company "made the difficult decision to remove native Bitcoin support & other UTXO coins" from Coinbase Commerce, citing difficulties in providing recent updates to its EVM payment protocol for Bitcoin.

"The new Commerce product enforces the details of every payment on the chain, supports hundreds of assets (native and ERC-20)  automatically converts payments to USDC on the chain at a guaranteed rate to the merchant. Providing the same capabilities on the Bitcoin chain without smart contracts and stablecoins is challenging & therefore we took the difficult decision to remove support for native Bitcoin & other UTXO coins.”

Shoppers who pay with Coinbase Commerce will still be able to use Bitcoin if they have an account with the exchange, CEO Brian Armstrong stated at X, adding that the company is in the process of integrating the Lightning Network into Coinbase.

"Hopefully there will be an opportunity to make a trade payment with the Lightning in the future," Armstrong said. Lightning Network is a payment protocol designed to facilitate transactions in the Bitcoin blockchain. Bitcoin transactions have been running on the protocol since 2017.

"In the big picture - we think paying for goods online with crypto won't really become mainstream until we get out of layer 1, and reduce transaction costs and confirmation times, so we're trying to accelerate the move towards that world," he said.

To track transactions, Bitcoin uses the UTXO, or Unspent Transaction Output, model. It is designed for transparency and security, in contrast to the Ethereum account model which is similar to a traditional bank account and allows for more flexibility. The UTXO model is also used by coins forked from Bitcoin, such as Dogecoin, Litecoin, Dash, and Bitcoin Cash.

The decision to remove native Bitcoin support sparked criticism from communities on social media platforms, with some users highlighting how the removal affected Bitcoin adoption.

"Is it assumed that every customer is in the US and can open a Coinbase account and/or that every customer wants to have a Coinbase account? That's like stipulating that every customer must be a Bank of America customer in order for merchants who only bank with BofA to receive payments," one user noted who uses pseudonyms.


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