Security Concerns Rise Over Bitpay’s Payment Protocol Policy

article featured image

Bitpay one of the most popular Bitcoin payment processing platforms announced on the 14th of December that all orders that were to be carrying out through their flagship Bitpay card would have to be from Protocol-Compatible wallets like their own wallet and a few reputable others. Although this announcement was made on the 14th of December, Bitpay had issued out a notice in the preceding month that all their processed invoices would soon need payments to be made from wallets made to be compatible with the Bitcoin Payment Protocol

Although this was a move done with good faith, it hasn’t generated much enthusiasm in the Bitcoin space particularly with a lot of wallet developers because not all of them are accepting the required bitcoin payment protocol as yet. In fact, some wallet developers are even resisting the move accusing Bitpay of wanting to take advantage of the situation by abusing the fact that it has the largest control of the market share for Bitcoin payment processing. Nevertheless, the major reason why a lot of those wallet developers and providers are rejecting the move by Bitpay is because they have strong reasons to believe that Bitpay’s move would largely compromise user security.

Basically the way the BIP70 or the Bitcoin Payment Protocol works is by helping reduce user error in bitcoin payments. There are times when bitcoin payments go wrong because most bitcoin transactions are facilitated via a third party and obviously, under such conditions, the margin of error would be ridiculously high as intrusions are easy to carry out especially when there is a third party involved. In addition to preventing such errors, Bitpay’s Bitcoin Payment Protocol will also help in helping stabilize transaction costs and keep them at a rate that could almost be classified as being static.

So, by removing the middleman from the equation, the new payment protocol would be able to connect two wallets (the sender and the receiver) and their address over an SSL encrypted connection. Instead of using cryptic Bitcoin addresses, the protocol will work with human readable identifiers which are then easily translated to resulting Bitcoin addresses.

To date, according to the information that can be found on Bitpay’s website, there are some wallet providers that have taken up this new payment protocol namely Mycelium and copay. Some major wallets are soon to join the bandwagon as is the main ambition of Bitpay to include almost every player in the Bitcoin ecosystem and find innovative ways of convincing them to uptake this new payment protocol.

Lastly, addressing the issue of security concerns that was raised by some wallet providers over the Bitcoin Payment Protocol by Bitpay. Most wallet providers are skeptical due to some of the vulnerabilities associated with features such as OpenSSL which are key in Bitpay’s new Payment Processing Infrastructure.

This vulnerability explains why some wallets such as Coinbase haven’t done much to adopt BIP70 but with time and rigorous testing, Bitpay’s new Payment Protocol is likely going to receive further uptake.

Older Post Newer Post

Other articles