Xapo, the California-based Bitcoin wallet and underground vault cold storage provider, announced Thursday its plan to release the world’s first Bitcoin debit card that works anywhere major credit cards are accepted.
Set to start shipping in two months, the debit card is linked to a Xapo hot wallet and will function like a traditional debit card regardless of whether the merchant accepts Bitcoin. The card will operate on a yet to be determined major credit card payment network.
Xapo CEO Wences Casares said the company is currently working with an undisclosed bank for the release.
“For the first time, customers have the ability to use bitcoin at any online or offline merchant that accepts debit or credit cards,” wrote Casares in a blog post. “This makes it easy for users to pay with bitcoins in real-time and makes it seamless for merchants to accept payment. After a customer makes a payment using bitcoin, the merchant will receive the funds in their local currency.”
Once a transaction is initiated, Xapo determines whether the user has enough funds to cover the transaction, authorizes the purchase and sells the required amount of bitcoin on the Bitstamp exchange. The payment is then sent to the merchant in their local currency and the transaction appears to the credit card company as any other transaction would.
The Xapo card differs from prepaid cards offered by Coincard and Cryptex because the Xapo card debits directly from the hot wallet. There’s no need to manually convert bitcoin into local currency before a transaction.
“The mission of Xapo is to provide a system that is both convenient and secure. We offer our fully-insured Vault with the security needed for confident bitcoin savings combined with our easy-access Wallet. The Xapo debit card provides users a new, simpler way to access bitcoins and use them for everyday transactions,” said Casares.
The company is offering a digital version of the card for free and a physical card for $15. Sign up is now open on the Xapo website.
Casares told CoinDesk: “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.”