On April 7, Hong Kong-based company Cryptex announced that it is launching a new Bitcoin-compatible debit card that can be used at existing ATMs in 80 different countries, including 90 percent of the ATMs in the United States. This will make Bitcoin far easier to use by dramatically increasing the number of points of exchange around the world, making it simpler to convert Bitcoins into local currencies after receiving them.
Customers will order a Cryptex Card online and put Bitcoins on it, which is then shipped to the customer like any other credit or debit card. Once shipped to the customer, the card can be loaded online by sending Bitcoins to a Cryptex address assigned to the card. A specified amount of Bitcoins can then be converted into local currencies, which can be withdrawn from ATMs. The customer does not make direct currency exchanges via the card, but rather online through Cryptex.
“This is a huge development for Bitcoin,” said Cryptex co-founder Jamon Rahn, “because Bitcoin ATMs are sparsely located and Bitcoin exchanges make withdrawal a burdensome affair. We are vastly increasing liquidity and convenience for holders of Bitcoin.”
Cryptex Card is not the first such card; a similar card was released by Bitplastic last year. It charges $1.50 per ATM transaction with a daily limit of $200 and an annual limit of $3,500, which at current exchange rates is less than 0.5 Bitcoins per day and 8 Bitcoins per year. The card also costs 0.25 BTC (about $110 at current exchange rates). Cryptex has yet to reveal a fee or limit structure. There have also been dedicated bitcoin ATMs, but these require new infrastructure rather than relying on existing systems.
Cryptex Inc. is a new cryptocurrency financial services company founded by payment veterans based in Hong Kong and Singapore. Its seed investors include Tero Ojanperä, managing partner, Vision+ Fund and ex-CTO and past member of the executive board of Nokia; Ken Hertz, senior partner at Hertz Lichtenstein Young Media Law and early investor in Spotify, Uber and Basis; and Michael Terpin, co-founder of BitAngels and founder of Marketwire. The company plans to launch other cryptocurrency card offerings and payment solutions.
Bitcoin exchange rates were relatively stable following the news. In the past 24 hours, the rate on Bitstamp dropped from $455.06 to $452.61. The rate on Bitfinex dropped from $455.99 to $452.42. The rate on BTC-e fluctuated, but started and ended at $450.00.