As the popularity of Bitcoin and other cryptocurrencies continues to surge, more and more companies are adding features to allow people to participate in the crypto market. By adding its crypto-fiat exchange service yesterday, UK-based Revolut is the latest of these companies. Earlier yesterday we congratulated the team for joining the crypto club and expanding the crypto economy by facilitating its adoption among its customers.
As Europe’s leading crypto to local currency money service, we wanted to share our first thoughts on what problems Revolut aims to solve.
Crypto buying and selling
Although access to the initial release is limited only to premium accounts, users can now instantly buy cryptocurrencies from the app. One can select their preferred currency pair of choice. While starting with Bitcoin, Ether and Litecoin, there are a number of fiat currencies available from which one can choose. For example, buy bitcoin for euros or sell the other way around.
While we can’t yet compare the rates to the rest of the market, Revolut does rely on Coinbase and Bitstamp to set its price. Its terms and conditions also state that in doing so, Revolut charges a 1.5% mark up of each transaction to account for volatility.
Acquired cryptocurrencies are stored on the app. While there is no dedicated crypto wallet to support the currencies (whether bitcoin, ether or litecoin), there is a price chart that shows price fluctuations on a daily, weekly, monthly or yearly basis.
From our experience, seasoned cryptocurrency users prefer to have their capital secure with multiple layers of protection including multisignature wallets. This is because over the years multiple cryptocurrency exchanges have been hacked and their users drained of their funds with the most notable being Mt. Gox and last one taking place just yesterday morning with $64 million in users’ funds losses.
Upon acquiring cryptocurrencies, some users prefer to move them to offline wallets with multiple backups for extra security to safeguard against events such as the phone getting hacked or losing access to your app.
In addition to security, storing cryptocurrencies in a separate wallet is essential for giving users the freedom to trade in other cryptocurrencies. Nowadays many cryptocurrencies besides bitcoin make the headlines (e.g. Lisk and IOTA), and users who can’t extract their bitcoin to a separate wallet will not be able to buy other currencies since most of the time they are sold for BTC or ETH.
Lastly, by having access to a wallet independent from the app, users will be able to export their private keys (in most cases). Besides security this allows users to follow their currency of choice in the event of network splits and claim free money - as what happened with the Bitcoin Cash fork.
The crypto economy is growing
In May 2017, cryptocurrency users made up less than 1% of the world population and the cryptocurrency market stood at 170 billion. Just this week the crypto market surpassed $400 billion. By introducing a cryptocurrency exchange, Revolut will certainly contribute to the industry’s expansion and will help a more mainstream user base join the revolution.
Here’s to advancing mass crypto adoption!