Coinbase Killer? Binance Adds Direct Debit and Credit Card Purchases
Binance, the world’s largest crypto exchange, announced Thursday that investors can now directly purchase major cryptocurrencies using Visa and MasterCard debit and credit cards.
— Binance (@binance) January 31, 2019
According to the announcement, users on Binance can now use Visa and MasterCard to buy Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and XRP (XRP) through a new partnership with Simplex, a leading payment processing company. If that name sounds familiar, its because Simplex has provided direct card purchase functionality for numerous other platforms, including Abra and Changelly.
Binance indicates that the average transaction will take between 10-30 minutes, and the exchange will charge 3.5% or $10 per transaction, based on whichever is higher.
“The crypto industry is still in its early stages and most of the world’s money is still in fiat. Building fiat gateways is what we need now to grow the ecosystem, increase adoption and introduce crypto to more users,” said Binance CEO Changpeng “CZ” Zhao.
This news comes as Coinbase, which has long-enjoyed being the only real fiat on-ramp option, launched an affiliate program that will reward websites and blogs for referring new users. The move suggests Coinbase is focused on drumming up more users as it attempts to combat the 13-month crypto bear market, however, Binance adding debit and credit card functionality could ultimately outweigh Coinbase’s new affiliate program.
It is important to note that many banks view credit card purchases on digital asset exchanges as margin trading and treat it as a cash advance with a higher APR, while others ban the purchases outright. The likely impending hike in crypto purchase activity could draw additional scrutiny.
Photo: Hektor Ehring Jeppesen / Flickr
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.