U.S. real estate firm WeWork, which provides office and work solutions, announced it now accepts Bitcoin, Ethereum, USD Coin, Paxos, and other cryptocurrencies as payment for its services.
Its CEO Sandeep Mathrani said his firm’s strength lies in adapting to meet the needs of its members. With a growing fintech userbase, Mathrani felt it was the right thing to do.
“WeWork has always been at the forefront of innovative technologies, finding new ways to support our members. It only makes sense for us to expand on the optionality we provide by adding cryptocurrency as an accepted form of payment for our members.”
Doing this, and paying landlords and suppliers in crypto, is possible thanks to BitPay, which provides layer 2 or “off-chain” solutions.
BitPay CEO Stephen Pair said his firm intends to utilize cryptocurrency to transform how businesses and people send, receive and store money.
When it comes to Bitcoin as a payment method, the base layer leaves a lot to be desired. However, pioneers such as BitPay show that layer 2 solutions can make better use of “old-tech” for this purpose.
Did Tesla remove its payment option?
As such, the WeWork move came amidst some concerns of Tesla temporarily removing its Bitcoin payment option (at least for some users) earlier today. The carmaker had announced earlier this year that it would accept payments in Bitcoin from customers in the US.
However, as noted by Twitter user ‘billcashidy‘ today, Tesla seemed to have temporarily removed the Bitcoin payment option for a few hours today, sparking concerns in the community that Bitcoin’s price volatility made it an unreliable payment method.
— 8Ball Bill Cashidy – Binance Smart Chain (@billcashidy) April 19, 2021
The case against Bitcoin as a payment method
Neither the firm nor CEO Elon Musk has commented on the situation as of press time. But speculation can be drawn over Bitcoin’s flaws as a payment method.
Buying a Tesla with Bitcoin came to symbolize cryptocurrency adoption. Nonetheless, the biggest problem with their setup was pricing in dollars and converting to Bitcoin. Doing this creates several inconsistencies that get magnified due to its volatility.
Firstly, customers could be paying wildly different Bitcoin prices for the same product. Also, problems arise when it comes to refunds and buybacks. Add to that the capital gains tax obligations triggered when buying in Bitcoin, and fiat offers a cleaner, more hassle-free experience.
A solution to deal with some of the issues is to price in Bitcoin. But considering the world’s expense and supply chain operates in fiat, this option won’t be happening anytime soon.
Add to that the slow 5 transactions per second (TPS) throughput on the base layer, and it’s clear that, as things stand, virtually anything else makes for a better payment method.
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