One of the main benefits of using bitcoin compared to traditional payment methods is confidentiality. When a bitcoin transaction is sent, it becomes a permanent and public on the blockchain, but not tied to any specific person.
However, one of the main problems of the use of bitcoin remains a limited number of sellers and services that accept it as payment. That is why many cryptocurrency companies enter their debit card - a product that accepts bitcoin and converts it into a Fiat currency for use in traditional outlets.
The problem with bitcoin cards is that they usually require the same level of financial disclosure, as traditional financial institutions.
Although such cards is an advantage compared to banks which may close the client's account at any time under any pretext (especially under pressure from the government), their financial privacy does not actually exist.
Consider eight of the most well-known issuers of debit cards with support for Bitcoin in America and Europe.
Bitcoin card in the USA
Coinbase
Coinbase launches debit card Shift Card that uses bitcoin wallet Coinbase for each transaction.
This is useful as it protects clients from having to keep your Bitcoin wallet separately from the purse card and refill the card balance before the transaction, instead of to run with the Shift Card single process.
In this sense, the Shift is closest to this debit card Bitcoin. However, Shift Card is not available in all States. As for privacy, Coinbase fully complies with the requirements of the regulator, and essentially requires full identification of the customer.
BitPay
Map from BitPay is the only Bitcoin card, available throughout the United States. Unlike Coinbase card like any other card on this list, BitPay card is a prepaid card with a balance of traditional currency after being converted from Bitcoin.
BitPay requires a full identification to use your card. However, it does not require any identification documents. Instead, BitPay users must enter a social security number.
Bitcoin cards in Europe
Xapo
Xapo is one of the main cryptocurrency cards in Europe and abroad, became famous after its use for Uber in Argentina. The map is currently not available in large list of countries, first among them the United States. It also requires full financial disclosure.
Anni Rautio, product Manager, Xapo, does not think that the financial anonymity possible for a bitcoin debit card, unless the bitcoin not used for the prepaid debit card.
"As long as debit cards, bitcoin or other - related to long-term players in the market such as Visa or MasterCard, anonymity impossible at 100%. The only option I can imagine for anonymous debit cards are prepaid/pre-loaded debit card that you can buy at places like CVS. Their function, however, is more similar to gift cards, and those generally uncomfortable in the long term."
Rautio noted that the focus of these cards is not to allow for maximum privacy and maximum convenience.
"The purpose of Xapo - the introduction of bitcoin in the everyday lives of people around the world. This will happen only when we will be able to make bitcoin accessible, easily understandable and familiar so that large-scale adoption of bitcoin will be able to continue."
Satoshi Tango
Another card used Uber in Argentina, map SatoshiTango also requires full financial identification. It is available in most countries, except the United States.
Matias Bari, CEO SatoshiTango, explained that the usual identification requirements still occur, although are less stringent than those required by banks.
"In order to open an account in SatoshiTango, you need to confirm your identity with proof of identification and residential address. You don't need the same level of checking as to the owners of Bank accounts, but you can't request a prepaid card or even buy and sell bitcoins, not letting us know who you are".
Bitwala
Another of the bitcoin card from the company, which became famous thanks to ability to pay various bills in bitcoins Bitwala card, also unavailable in the United States. From all other bitcoin cards it features integration with exchange ShapeShift. This means that the customer can top up his card and other cryptocurrencies.
Geoff Gallas of Bitwala explained that their map requires the usual forms of identification, and that all existing cards will probably require the same.
"As far as we know, all bitcoin debit cards in the market require some kind of identification. For Bitwala card we have to fulfill certain requirements that include a review of customer data."
However, in the future Bitwala will be able to provide solutions for those who do not have appropriate forms of identification from the state.
Cryptopay
Mostly European map, it is also not available in the United States and requires the same forms of identification for unlimited use. CryptoPay requires identification in order to unlock unlimited use.
However, they do provide some opportunities for untested cards. This means that the client does not need to provide the documents if he owns the map for a short time, which is less than its shortest duration.
According to General Director George Cryptopay, Basiladze: "If the debit card provider offers a completely unlimited and anonymous card, it means that the operator or violates any law, or is lying, so users should avoid it."
Wirex
Like Cryptopay, Wirex (last E-coin) in addition to providing full-service identification card, allows customers some time to remain unchecked. Wirex founders Dmitry and George believe that the privacy and anonymity of bitcoin cards is possible, provided that the lower level of the validity of the card is considered valid.
"At the moment it is technically possible for bitcoin debit card to be kept private and anonymous. As long as the customer is happy with the limitations of short-term cards, there is no need to provide any documents."
According to the creators of Wirex, the world is completely private bitcoin cards could soon end, forcing all customers to obey the rules of identification.
"Regulation of prepaid cards is becoming stricter. For example, in the near future will be reduced the limits for unverified card holders. There are attempts to establish links between prepaid cards and fraud or other unlawful activity. Therefore, there is no reason to expect that the anonymous debit cards in the near future will exist on platforms with Visa and MasterCard.
The best solution
Even if there is no perfect solution to preserve the privacy of the users of the bitcoin card, a reasonable compromise can be found. A user wishing to maintain confidentiality can purchase a card that does not require validation or with a limit on transactions, or purchase a few untested maps, each time moving to a new one.
Some clients may wish not to have any limitations of the duration of validity of the card, but still wanting more privacy. For those who have two or more nationality, had checked the map with the citizenship and better in the currency of the country in which the client actually lives and works. This will help to maintain the financial activities, apparent power, having low relations with the citizen, ensuring that neither party knows too much.
Sources:
https://www.coinbase.com/
https://bitpay.com/
https://xapo.com/
https://satoshitango.com/
https://www.bitwa.la/
https://cryptopay.me/
https://wirexapp.com/
This is a great piece and thanks for sharing. I'm happy to upvote and share this on Twitter✔ for my followers to read. Following and looking forward to reading more of your posts. Cheers. Stephen
Thank You!!!
Always good to hear about Bitcoin. Thank you for posting.
useful information! Thank you.