Bitcoin debit card
Bitcoin debit card (Bitcoin card, Crypto card) is a banking plastic or virtual payment card that can be used with Bitcoin or other cryptocurrencies. Cards are mainly issued by Visa, Mastercard, and UnionPay. Bitcoin cards may be used as general banking card at any ATM, retail terminal, online shop or place of sale where a bank card is accepted. It is considered as a convenient way of using Bitcoin where it is not accepted as payment.
Bitcoin debit cards have been criticized for braking the idea of decentralization, being the a link between cryptocurrencies and fiat currencies, and lack of trust. Bitcoin debit cards can also be viewed as a way of money laundering.
Design[edit]
Bitcoin cards are issued by financial institutions, such as cryptocurrency company or payment provider in partnership with a card issuer.
There are two types of Bitcoin debit cards available for use:
These types have differences which affect the usage and acceptance by customers.
Prepaid Bitcoin card[edit]
A Prepaid card can be loaded with funds and is not linked to any bank account or cryptocurrency wallet directly. Bitcoin must be converted into supported fiat money and then loaded to the card before spending. Conversion is usually done by the company which provides a card or with the help of third-party cryptocurrency exchange.
Debit Bitcoin Card[edit]
A Debit Bitcoin card is linked to a cryptocurrency wallet. Spending initiates the conversion. Bitcoin is converted and loaded to the card at the moment of spending. The only cryptocurrency company providing debit cards is ShiftCard.
Acceptance[edit]
The number of unique active users of cryptocurrency is estimated to be between 2.9 and 5.8 million[1] according to the University of Cambridge research. The acceptance of Bitcoin card by cryptocurrency owners was never studied.
Security and anonymity[edit]
The case of security and anonymity is discussed by cryptocurrency owners mainly due to card centralization. Blockchain technology is decentralized. Customers give control of money to a third-party by converting Bitcoin to fiat money and depositing it into a company account. This contradicts with the initial idea of Bitcoin as a replacement of fiat money.
Customers have to complete KYC and AML verification to verify identity. This destroys the privacy, which is created by using Bitcoin peer-to-peer.
Bitcoin card providers[edit]
There are about 30 companies who claimed the intense to issue Bitcoin debit cards or issuing them. List of Bitcoin debit cards.
WaveCrest crash in January 2018[edit]
On January 3[2], 2018 Visa terminated payment technology company WaveCrest Holdings to issue cards. All the previously issued Bitcoin cards were blocked abruptly.
Payment providers affected by ban: AdvCash, Cryptopay, Xapo, BitPay, Wirex, TenX, Biwala, Bonpay, Spectrocoin, Monaco, Exwal, Coinsbank, ShakePay, Uquid, lost their cards.
See also[edit]
References[edit]
- ↑ "Global Cryptocurrency". Cambridge Judge Business School. Retrieved 2018-08-30.
- ↑ Hughes, Matthew (2018-01-05). "Multiple Bitcoin debit card providers suspend service under orders of Visa". Hard Fork | The Next Web. Retrieved 2018-08-30.
External links[edit]
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