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A growing number of companies are allowing Bitcoin to be sent through gift cards. Are there any risks in using such services?
An affiliation of companies are now allowing consumers to send each other Bitcoin for Christmas among other things. Gyft vs. Bitgreet.
BitGreet, Gyft, Bitcoin, CoinCorner, Gift Cards, Business, Technology
A BitGreet alliance lets its clients add Bitcoin to special Christmas e-cards. Now people are able to send Bitcoins with those cards just as easily as they would do with fiat money in an envelope. A pleasant surprise for holiday season, isn’t it? Is there a chance to lose money?
The service is backed by CoinCorner, a Bitcoin exchange, located on the Isle of Man. It was launched last Christmas—according to co-founder Daniel Scott—about a 1,000 cards were delivered over the holiday season.
The mechanism of the service is very simple. You just need to choose a card design at BitGreet’s web site and then add any amount of Bitcoins you want. That’s all! You can send it via e-mail. Also, you don’t even have to be one of CoinCorner’s clients to do so.
At first sight BitGreet’s service looks similar to other gift card services, such as Gyft and others previously mentioned on CoinTelegraph. But if you dig deeper, you’ll see the obvious difference. Gyft and other similar services allow buying gift cards for Bitcoins. That means you can buy cards for making purchases in particular stores.
Gyft and other gift card services allow buying cards for most of the major retailers, including eBay, Amazon and others, offering lots of bonuses for those who use Bitcoin. Gyft awards its new users with $5 for free. Bitcoin purchases are also awarded with a 3% discount. But if you buy, for example, a gift card for eBay, you will not be able to use it with any other retailer.
Meanwhile, BitGreet offers you a chance to send any amount of Bitcoin directly to the person you want. And that person will be able to use it with any store that accepts Bitcoins. Besides, the system is anonymous so you won’t have to submit any personal data to comply with KYC requirements.
And new users can breathe freely in case they have accidentally sent money to a wrong address or made any other mistake as they would be able to get their costs back thanks to BitGreet’s protection system. Of course, as long as the recipient hasn’t claimed the card earlier.
The only risk or the system is that you’ll have to trust your funds to CoinCorner even if you are not their client. Nathan Wosnack, CEO of Ubitquity, stated to CoinTelegraph:
“There is a possibility of CoinCorner going out of business, and the Bitcoin used for the cards being liquidated as part of bankruptcy proceedings to creditors. And the reverse of the coin with their “clawback” is that it gives them the power to pull back the purchases from the recipient as well”.
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