The Xapo Debit Card debits BTC directly from users’ hot wallets, and can be used anywhere MasterCard is accepted, both online and at physical locations, though it does not represent a partnership between the companies.
Xapo founder Wences Casares explained that the card is designed to appeal to Xapo users frustrated by the inability to spend their bitcoins at most locations, telling CoinDesk:
“You can use it anywhere you would pay with MasterCard, you can use it online, you can use physically at any place you can pay with MasterCard. It makes it very, very easy for you to access your coins.”The offering is immediately available in both a digital and physical version to existing Xapo customers. The digital version of the card is free, while the physical version comes with a $15 one-time fee that the company indicates covers shipping and handling.
New Xapo customers can also sign up to take advantage of the release. Shipping for all physical cards is expected to begin in two months, the company said.
Customer demand
As of its launch, the Xapo Debit Card is limited to one card per wallet account.
Said Casares:
“I think that this product is for existing customers who are asking for it. I expect a lot of the current customers to be using it.”Casares indicated that the ability for users to connect multiple cards to accounts may be added in the future, should customers request the feature.
How it works
Casares said that Xapo receives all transactions when they are initiated by card users at the point of sale.From there, the company analyzes the account to determine whether there are enough funds to support the transaction. If so, the company authorizes the purchase immediately and sells the requisite amount of BTC via bitcoin exchange Bitstamp.
Casares went on to explain that the offering is different than the available prepaid options from Coincard and Cryptex, which need to be preloaded with bitcoins and that, he said, require users to manually convert bitcoins to local currency before purchase.
Explained Casares:
“This one is just like a debit card, because it debits from the wallet directly. You don’t have to be thinking about funding it and how much and when the conversion happens.”Xapo users, by comparison, only need to move bitcoin from their cold storage vaults to their company-issued hot wallets when more funds are required.
Consumer focus
Though best known for its secure bitcoin vault storage product, Casares told CoinDesk that the Xapo Debit Card is consistent with his company’s mission of becoming a viable, consumer-focused bitcoin bank.Said Casares:
“We’re not a wallet company or a payment company. We are a bitcoin wallet, we are a bitcoin bank. Consumers need convenience and that’s why we provide our MasterCard debit card and why we will keep adding products based on our customers want.”Casares went on to stress Xapo’s commitment to consumers, stating that the company will never have merchant customers or offer merchant services.
The launch follows Xapo’s 13th March announcement that it raised $20m in funding from Benchmark, Fortress Investment Group and Ribbit Capital.
Images via Joshua Alvarez of The Hatch Agency
