Bitcoin exchanges around the world have been looking at various ways to make the purchase of digital currency much easier for novice users. Instant bank transfers are not available in every individual country, but credit and debit cards are widely accepted. Bitstamp has enabled support for residents in the UK and Slovenia to buy Bitcoin with these traditional payments.
It goes without saying that enabling payments through credit and debit cards could be a risky move on Bitstamp’s end. Both of these payment methods are often linked to fraud and chargebacks, which could be of particular worry for a service provider dealing with non-refundable digital currency in the form of Bitcoin.
However, Bitstamp has gone ahead with enabling plastic card support, although the feature will not be available worldwide just yet. For the time being, only users in the United Kingdom and Slovenia can experiment with these new payment options as both Visa and MasterCard are supported. Other European countries will be added over time, although no further details have been announced.
Based on the Bitstamp blog post, the process of buying Bitcoin with a credit or debit card will lead to instant purchases. It is important for users to keep in mind these transactions are limited regarding daily volume, similar to the service provided by companies like Bittylicious and Circle.
Verification and completion of this procedure will occur through Vogogo, a company that has made a name for itself in the Bitcoin industry throughout the years. By providing advanced risk management solutions to businesses all over the world, Vogogo aims to provide the perfect defense mechanism against fraud attempts through traditional payment methods.
To access this new deposit methods, Bitstamp users in the UK and Slovenia can go to the deposit page, and select “Credit Card’ as a payment option. Then they will have to enter the amount of funds they want to spend – limited to US$300 per day or US$1,500 per week – and once the card details are entered, hit the “Submit” button. Assuming all of the information checks out, the transaction should be completed automatically.
Whether or not other Bitcoin exchanges around the world will follow the lead of Bitstamp, remains to be seen at this point. That being said, it is the first time a major European exchange enables plastic card payments, even if it is in a limited fashion for the time being. Considering how much trading volume Bitstamp has on a daily basis, these numbers could very well increase over time.
Outsourcing the processing and verification of plastic card payments to an external payment such as Vogogo is a smart decision on BitStamp’s behalf. Keeping up with regulatory requirements when dealing with [international] bank transfers is hard enough as it is. Plus, if the partner offers that type of functionality, it would be a shame not to use it.
What are your thoughts on the option of buying Bitcoin from an exchange with a credit or debit card? Let us know in the comments below!
Images courtesy of Bitstamp, Vogogo, Shutterstock
1 Hova Villas Brighton & Hove
BN3 3DH United Kingdom
All rights reserved by Bitcoinist Ltd. | 2016.