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[BTC/USD] Price Analysis: $10,000 for Bitcoin in 2019 — Is It possible? Of Course!
[BTC/USD] Price Analysis: $10,000 for Bitcoin in 2019 — Is It possible? Of Course!

How to Buy Bitcoin with Prepaid Cards: Beginner’s Guide

  • Alex Morris
    ⭐ Features

    U.Today has reviewed the best ways to buy Bitcoins with your stack of prepaid cards

How to Buy Bitcoin with Prepaid Cards: Beginner’s Guide
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The major difference between an ordinary debit card and a prepaid card is that the former is not pegged to a checking account in a bank. The funds are loaded on such cards in advance so that you can spend them. Case in point: reloadable MyVanilla prepaid cards that can be easily bought in your local Walmart store. The card’s current balance can be checked on the official website of its issuer.          
In most cases, prepaid cards are used as gifts — it is a very convenient way of sending money to a specific person if cash is not an appropriate option. Subsequently, it gives much more flexibility to a person who receives the gift since VISA prepaid cards are accepted all over the globe. One can buy clothes, electronic devices or...Bitcoin, the world’s biggest cryptocurrency.  

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Can you buy Bitcoin with gift cards on Coinbase?

Of course, Coinbase is the most obvious choice. The $8 bln startup, which is spearheaded by Brian Armstrong, is among the world’s most famous exchanges. Even with the recent listing spree, Coinbase still has a very meager choice of assets, but Bitcoin is on the list. However, prepaid cards are not accepted there despite some websites claiming otherwise.   
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US customers are able to make instantaneous purchases with their debit/credit cards, but Coinbase requires everyone to complete ID verification before adding a card. It is safe to say that the Armstrong-led exchange will never accept prepaid cards due to security concerns.

In July, however, the exchange launched its own Coinbase VISA gift card for European customers. These Coinbase prepaid VISA cards are accepted to propel the merchant adoption of cryptocurrencies. As of now, there is a huge gap between people investing in Bitcoin and people buying their Starbucks coffee with it. To tackle this issue, Crypto.com has already introduced the first crypto debit card.  

How to use Paxful?

After obtaining your prepaid card, you have to look for an exchange that actually accepts it. It is worth mentioning that buying Bitcoin with a prepaid VISA card is not an easy feat since exchanges are afraid of opening a Pandora’s box of financial manipulations. However, we’ve still managed to find some ways of purchasing crypto with practically any prepaid card.

First, we are going to cover a fairly popular website called Paxful. The website allows you to buy and sell Bitcoin while using a myriad of payment options (up to 300). Paxful accepts gift cards issued by VISA/Mastercard (the aforementioned MyVanilla prepaid cards), Walmart, Amazon, and so on.
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For more options, you can click the “Buy Bitcoin” button in order to open a new page with a search bar where you can manually find any payment method after choosing the suitable currency.
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This is the long list of all open offers that are sorted accordingly to the exchange rate. The seamless process of purchasing Bitcoin with gift cards comes with draconian fees. For example, if you want to buy Bitcoin with an iTunes gift card, you would have to pay a hefty commission that may go as high as 60 percent — for every dollar you spend, you get only $0.40 worth of Bitcoin. Usually, sellers offer the highest exchange rates (you lose less than 10 percent) if you meet them in person. In order to buy BTC with a prepaid card, simply click the green button on the right.
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Paxful also allows you selling Bitcoins. Simply choose the “Sell Bitcoin” option and decide what kind of payment method you would like to accept (whether these would be gift cards, cash deposits or online transfers).  

Paxful Pros and Cons  

Pros  

Cons

A beginner-friendly exchange

Different exchange rates

An enormous number of payment methods  

A lot of scammers

Buyers are not charged with any fees

A one-percent fee for sellers

Remember about safety


How safe is it? Paxful claims that their sellers’ Bitcoins are held in a secure escrow until the transaction is completed, which eliminates the possibility of a fraud. The peer-to-peer exchange creates a temporary Bitcoin wallet in your personal account. In order to enhance their security, users are recommended to enable 2FA.

Paxful and LocalBitcoins are both well-known peer-to-peer exchanges with a huge user base, but they cannot ensure that every seller is reliable. Hence, we recommend you to pay attention to the following rules:

  1. The system features feedback rating of a certain seller (any negative comments would obviously be concerning).
  2. We recommend you to make sure that you take a screenshot of every transaction.
  3. Also, protect your personal data — any private information shouldn’t be disclosed. You don’t want to lose your money, right?


Things may get even way worse than wasting your $20 gift card — as U.Today reported earlier, a man from Norway was brutally murdered during a LocalBitcoins meet-up. This is why it is important to have at least a quick live chat before having a direct contact with this person.      

Transaction cancellation is another point that has to be covered in order to prevent financial losses. Do not reveal any gift card details to the seller if you are not 100 percent sure whether the transaction has to take place. While it’s possible to call off the purchase, the seller will certainly be tempted to get access to your gift card.    
    

Alternatives to Paxful


Paxful isn’t the only option on the table if you want to buy Bitcoin with a gift card. You are also able to do this on LocalBitcoins.
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LocalBitcoins is the most well-known peer-to-peer exchange whose modus operandi is very similar to that of Paxful. The popularity of this exchange is skyrocketing in Russia as well as in some Latin American countries. With that being said, popularity is not necessarily a good thing because it brings more sketchy frauds, so follow all the above-mentioned safety measures.

Cointal is yet another peer-to-peer exchange for those who have no idea what to do with their gift cards, but it has a very questionable reputation with some users accusing it of being a fraud.

The bottom line

There are only two reputed exchanges that allow purchasing Bitcoin with a prepaid card. Despite the draconian exchange rates, it’s an excellent way to get rid of your stack of old cards.

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Question of the Day: Can Stablecoins Accelerate Cryptocurrency Adoption?

  • Yuri Molchan
    ⭐ Features

    Stablecoins show hardly any volatility compared to Bitcoin and altcoins, many are hoping that they will be able to bridge new crypto economy and regular fiat money

Question of the Day: Can Stablecoins Accelerate Cryptocurrency Adoption?
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Contents

Bitcoin, the father cryptocurrency, emerged in hope that it will remove all intermediaries in electronic commerce that cut off their share of payments. BTC was perceived as a P2P way to replace fiat cash in an electronic format, which would enable one party to pay another without any financial institution or payment platform which would demand its share of a transaction as a reward for its services.

What is wrong with Bitcoin

For quite a while Bitcoin was performing the way the crypto community expected. But the situation changed later – BTC rate became weaker, thus bringing down its financial and economic reliability, when it gets to be used as a regular means of payment.

You cannot have a currency that would cost like a British castle today, a gram of gold – tomorrow and a pack of French fries the day after.

At that point practical fintech minds came up with an idea of creating something which would become a breakthrough in the universe of crypto – a so-called stablecoin.

Will stablecoins solve the volatility problem?

Technically, stablecoins are protected from the volatility roller-coaster that Bitcoin and other cryptos love to ride. They are programmed to keep their prices stable and investors now are largely attracted to this new type of digital assets.

Stablecoin does not show any volatility in its monetary value, since it has a fixed connection to an asset it is pegged to. The major goal of using stablecoins is taking the best from decentralized crypto coins and combining it with a constant value. Thanks to it, stablecoins can be used as a reliable means of trade.

Asset-pegged stablecoins

Asset-backed ones get their value from an asset as can be understood from the name. An asset provides the necessary value to a coin, as well as the necessary legitimacy.

A great example of an asset-pegged stablecoin is Tether (USDT). In spite of a series of scandals at the end of last year, it remains the most popular stablecoin in the crypto market.

Recently, it has partnered with the Tron Foundation to launch a Tron-based stablecoin.

Other examples are TrueUSD (TUSD), USD Coin (USDC), the Gemini Dollar (GUSD), and the Paxos Standard (PAX). They are all pegged to the USD.

Crypto-backed stablecoins

Some digital coins work in a similar way to fiat-backed ones, however, they are pegged to collateral crypto. That means that crypto assets that ensure the value of such stablecoins are stored in a wallet similar to escrow.

A good example of a crypto-pegged token is Maker, which is ranked 16 on CMC.

Algorithmic stablecoins

Even though, stablecoin can be interesting at first thought but the way they are built goes against the principle of decentralization that crypto coins have as a foundation. Thus, many crypto fans and evangelists are positive that stablecoins must be linked towards not a centralized asset but a computer algorithm which takes value from a balance between supply and demand.

Basis is now considered the most promising algorithmic stablecoin of all.

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Can stablecoin ensure smooth future for the crypto industry?

The primary goal of all crypto assets was and remains to come up with virtual asset that would be liquid enough and not vulnerable to market volatility. From this point of view, stablecoins are a dream of all crypto fans and evangelists of a decentralized economy.

Apart from the potential to conduct crypto transactions smoothly, experts believe it can bridge the two worlds – fiat and crypto, bringing them a mutually beneficial coexistence. However, that may take time.

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