Business 5 January 2018Jasmine Solana
VISA Europe cuts off BTC debit card services over issuer’s ‘non-compliance’
Spending SegWit1x (BTC) with a debit card has just gotten a lot harder.
On Friday, BTC debit card service providers Xapo, Bitpay, Bitwala, Wirex, TenX and Cryptopay abruptly suspended their services over a crackdown by VISA Europe on their prepaid card issuer, Gibraltar-based WaveCrest Holdings, Ltd.
A Xapo cardholder posted on Reddit the email from WaveCrest: “Visa have today instructed us that we must close all WaveCrest issued Visa Prepaid Cards with immediate effect. How will this affect you? Your WaveCrest-issued Visa Prepaid Card will no longer function. However, as your funds were stored in your e-wallet they will remain accessible to you via your wallet provider.”
Reddit user RedStarSailor also posted the message from BitPay, informing cardholders that VISA ordered WaveCrest “to immediately close all accounts of its prepaid Visa debit card programs.”
“The BitPay Card (non-US) is one of these programs, along with other cryptocurrency-related and standard prepaid Visa debit cards. Unfortunately, Wave Crest was unable to provide us or cardholders with more time to prepare for this change,” according to BitPay.
Meanwhile, Bitwala, Cryptopay, and Singapore-based TenX confirmed the news on Twitter. Bitwala said its team “is holding an emergency meeting to resolve the issue with the card holders best interest in mind,” while Cryptopay assured its customers that “all funds stored on cards are safe and will be returned” as soon as possible. BitPay said it’s “already in discussions with potential alternative issuers for the BitPay card which will allow us to serve customers in Europe and beyond.”
According to The Daily Beast reporter Joseph Cox, the cause of the clampdown was digital payment solutions provider WaveCrest, which was flagged by VISA Europe for its “non-compliance” with the credit card company’s membership regulations.
In a statement obtained by The Next Web, VISA Europe confirmed that they terminated WaveCrest’s VISA membership “due to continued non-compliance with our operating rules,” resulting in the cancellation of the Gibraltar-based company’s VISA card programs.
“VISA has other approved card programs that use fiat funds converted from cryptocurrency in a number of jurisdictions. The termination of WaveCrest’s Visa membership does not affect these other products,” the company said, according to the news outlet.
VISA made it clear that the action was against an erring company, not a crackdown on the cryptocurrency industry. But the damage has been done: Users who frequently use their VISA-powered debit cards reported that their cards had already stopped working—long before the companies made their respective announcements.
One Bitwala customer went on Twitter to inform the crypto company that he’s stranded abroad and without funds: “Mine stopped working, and I need the money, as I am on vacation and my hotel just canceled my booking because of that.”
VISA made headlines last year when it started partnering with BTC payment service providers for VISA-branded cards that will allow users to add bitcoin online and spend the balance at stores or withdraw from ATMs. However, Friday’s clampdown orders only goes to show that banking giants and credit card companies like VISA can censor anything they like—even at the risk of making themselves irrelevant in the face challenges instead of embracing new technologies into their plans. Because at the rate they’re going, these financial giants are only speeding the innovation of their ultimate replacement.
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.
Bitcoin Satoshi Vision (BSV) is today the only Bitcoin project that follows the original Satoshi Nakamoto whitepaper, and that follows the original Satoshi protocol and design. BSV is the only public blockchain that maintains the original vision for Bitcoin and will massively scale to become the world’s new money and enterprise blockchain.
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