User and newcomer-friendly wallet service iPayYou says it wants to help create a merchandising ecosystem for Bitcoin. To kick this off, it now allows users to buy gift cards from Amazon, Best Buy, iTunes and Starbucks. More retailers are coming within the month.
iPayYou and User-Friendly Bitcoin
iPayYou CEO Gene Kavner explained to Bitcoin.com his company wants to solve what he calls Bitcoin’s “desolation problem”. It’s the problem many Bitcoin newcomers experience — now they have coins, where are they supposed to spend them?
iPayYou functions as a regular online Bitcoin wallet. Its main selling point is user-friendliness — you don’t need to know anything about Bitcoin to use it. There’s no lengthy addresses or private key management. You can also send money to other users via email addresses or even Twitter.
Notably, people can also cancel payments if they were sent in error — something definitely not available with standard Bitcoin transactions.
Bitcoin Too Complicated for Newcomers
Kavner said he wants iPayYou to be the “friendliest” Bitcoin Wallet. He started the company after seeing difficulties some newcomers have in comprehending Bitcoin and how it works. “It’s too complicated. I had to help people create wallet addresses, then they always lost their private keys,” he said.
Then, he added, there’s the “desolation” problem.
“The average person asks, what’s next? Where do I use it? They find themselves on an island, and don’t know what to do with their bitcoins.”
Creating an easy, simple ecosystem for spending bitcoins is key to adoption, he said. Selling gift cards for bitcoin gives users something immediately useful and versatile to do with their digial cash.
In this sense, iPayYou is similar to other BTC-to-gift card services like Gyft and Purse.io. The difference is that iPayYou is primarily a Bitcoin wallet rather than a purchasing service that happens to accept Bitcoin.
iPayYou will add more retailers’ cards as options over the coming month. For now, the service deals in U.S. gift cards only. If gift card holders decide they’d prefer BTC or USD, the company will buy them back for a restocking fee. However this applies only to cards iPayYou has sold.
Combining Bitcoin Exchange, Wallet and Gift Card Service
Users add value to their iPayYou wallets just as they would a Bitcoin exchange. That is, the company accepts bank transfer deposits in USD or bitcoin deposits the usual way. There are still KYC procedures for users wishing to connect bank accounts and ACH information.
Within 30 days, Kavner said, iPayYou will connect to all U.S. banks for both USD deposits and withdrawals.
iPayYou does not accept gift cards purchased elsewhere. This means people can’t simply buy a card from a convenience store and use it to buy bitcoins, as they do with services like Paxful.
There’s a lot of security hassles to deal with in that space, Kavner said. That is, users can try to defraud the company by using fake or spent cards. “And every time something goes wrong, people will blame Bitcoin.”
Starting immediately, iPayYou is selling cards from Amazon, iTunes, Best Buy and Starbucks. This means users have a pretty broad range of goods to purchase with bitcoin. If successful, it will be the start of the spending ecosystem Kavner seeks.
Are gift cards a good starting point for a Bitcoin spending economy? Will you try out iPayYou, or do you prefer to hoard your coins? Let us know in the comments.
Disclaimer: Bitcoin.com owner Roger Ver is an investor in iPayYou.
Images via Shutterstock, iPayYou
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