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Half of all crypto transactions on PC gaming platform Steam were fraudulent before it removed Bitcoin as a payment option, according to Valve president Gabe Newell.
Speaking to PC Gamer, Newell said that, "We had problems when we started accepting cryptocurrencies as a payment option. 50% of those transactions were fraudulent, which is a mind-boggling number. These were customers we didn't want to have."
He said that the crypto space is populated with actors that, "are not people you want interacting with your customers."
Steam introduced Bitcoin as a payment option in April 2016, but abandoned the experiment in December 2017, citing the cryptocurrency's price volatility and "a significant increase in the fees to process transactions on the Bitcoin network."
Newell told PC Gamer that Bitcoin's price unpredictability made it "a complete nightmare" to use for transactions, as a game could cost $10 one day and $100 the next.
In a separate interview with Eurogamer, he noted that cryptocurrency volatility meant that customers "had no idea what price that they were actually paying," adding that, "Yes, they were anchored to a cryptocurrency, but most people's wages are not in cryptocurrencies."
The company remains open on the possibilities of distributed ledgers and blockchain technology, though Newell remains skeptical of their benefits. "There's a lot of really interesting technology in blockchains and figuring out how to do a distributed ledger," Newell told PC Gamer, adding that, "I think that people haven't figured out why you actually need a distributed ledger."
NFTs and Steam
Valve made headlines in late 2021 with its decision to ban games "built on blockchain technology that issue or allow exchange of cryptocurrencies or NFTs."
In recent interviews, Newell has doubled down on that stance, telling PC Gamer that many NFT-based games were "ripping customers off."
Newell told EuroGamer that, "The things that were being done were super sketchy." He added that there was "illegal shit going on behind the scenes, and you're just like, yeah, this is bad." While conceding that blockchain is "a great technology," Newell said that, "the ways in which has been utilized are currently are all pretty sketchy. And you sort of want to stay away from that."