ShapeShift, a Switzerland-based crypto exchange has partnered with Wyre payments processor to enable its US-based customers to purchase cryptocurrency directly using their debit cards.
ShapeShift CEO Eric Voorhees made the announced on Twitter saying that,
“If you’re in the US, you can buy Bitcoin instantly in the new ShapeShift.com platform with your debit card. You can literally have the Bitcoin, in your possession, five minutes from now.”
According to follow up response tweets to commentators by both Voorhees and ShapeShift, it seems that the new product does not require any registration and therefore users will not have to deal with KYC.
Additional details reveal that the new service is able to circumvent the need for KYC because users will not be transacting with the broker but instead they will only be using the ShapeShift platform as a P2P platform. ShapeShift will then be able to charge a commission for overseeing the transaction.
The company claims that the charges are minimal. From its tweets on Friday, we can see that transactions will be charged at the going rate of 1.9% of the value transacted and an additional flat rate of $0.30. There will be a daily transaction limit of $250.
Unfortunately for New York residents, however, the service will not serve this particular state. This is because the Wyre service does not operate in New York. The state of New York has stringent financial rules thanks to the BitLicense requirement whose provisions pertain to virtual asset businesses. So few of these businesses have revived the go-ahead to serve the residents of New York even though the license was introduced back in 2015.
The service will only be accessible on the online web interface as of now according to Voorhees. Additionally, prepaid debit cards are not acceptable for use.
“Your crypto will be deposited in minutes to your ShapeShift wallet. You control your keys, once the funds are in your wallet you can send to any wallet that you own immediately with no waiting period,” ShapeShift wrote on Friday.
There seems to be a creeping uptrend by cryptocurrency exchanges to enable crypto purchases using debit cards as an effort to streamline the process of onboarding new users.
Just this week, leading cryptocurrency exchange Binance announced its upcoming debit card which has launched in beta in Malaysia. The debit card will enable users to use their cryptocurrency to make purchases similar to using usual Visa and MasterCard debit cards except you will now be able to spend your crypto balances.