Coinbase is putting a new spin on the cryptocurrency wallet and turning it into a gift card – well, sort of.
The popular exchange desk has partnered with digital gift card provider WeGift to offer a direct route for customers to convert the funds in their wallets into currency for the high street.
It’s a seemingly simple process. Go to the WeGift Coinbase website, select the wallet you wish to spend from, select the amount and gift card, press buy, and presto: you have real world, spendable money for some of your favorite stores.
It should be pointed out though, you won’t actually be spending your cryptocurrency on the high street. You will be exchanging crypto for the local currency and the eGiftcard will be loaded with that, which obviously, high street stores will accept. They will likely have no clue how you funded the gift card, unless you tell them – which you probably will.
Currently it appears that gift cards can only be purchased for Italy, Spain, France, Netherlands, the UK, and Australia (though it seems the Australian offering is pretty limited for now). I counted 36 gift cards currently available to buy for the UK market – at the time of writing – including Argos, Clarks, Evans Cycles, Halfords, Nike and Tesco. There’s well over 100 in total.
One of the common arguments against cryptocurrencies is that nobody accepts them in stores. While this is still mostly the case, this scheme does get us one step closer to spending crypto at Costa by connecting your wallet to a form of payment that store do accept. Though the issue remains, that crypto enthusiast still have to go through another middleperson and we should always try to understand who is benefiting in these partnerships.
Decentralization and blockchain promised to connect purchaser to merchant without the need for an intermediary. Yet here we have a new intermediary, and one that must be taking a cut, even if they do waiver the transaction fee. Granted, WeGift are not a bank or government, but this still isn’t the elegant solution of payment that so many cryptocurrencies promise us in their imagined digital utopia of the future.
Correction: This piece inaccurately suggested Coinbase received a three-percent fee for converting your cryptocurrency to a gift card. We’ve updated the piece to redact this statement. Apologies for the mistake.
Published July 25, 2018 — 12:11 UTC