One of the world’s largest Bitcoin and cryptocurrency exchanges, the San Francisco-based Coinbase, is hoping to grow its footprint in Europe with digital gift cards, as users continue to struggle to get their hands on their crypto gains.
Coinbase is rolling out the new feature, in partnership with London-based startup WeGift, that will give customers in Europe an alternative way to cash out their crypto coins.
Users, initially only those in the U.K., Spain, France, Italy, the Netherlands and Australia, will be able to convert virtual currency into gift cards from around 120 retailers including the likes of online giant Amazon, department store John Lewis, supermarket Tesco, and ride-hailing app Uber.
Coinbase plans to eventually grow the service into other countries.
“From converting Bitcoin into Uber credits or ether into a Nike shopping spree, customers will have greater flexibility and control over how they use their crypto,” Coinbase UK chief executive Zeeshan Feroz said in a statement.
“Making crypto easier to use, trade and spend is a core part of our efforts to improve the customer experience. With the launch of e-gift cards, customers now have the option to spend their crypto balances, realising its value to buy tangible things or experiences.”
Coinbase, which recently expanded into Japan, was earlier this year granted an e-money license by the UK’s financial regulator, the Financial Conduct Authority (FCA), allowing it to provide e-money services as a cash alternative for 23 European Union nations and the UK.
Actually using or cashing out their cryptocurrency continues to be a major headache for new users signing up to Bitcoin and cryptocurrency exchanges.
Many have complained that it’s far easier to deposit money than it is to withdraw it, often requiring them to verify their traditional bank account before the exchange can pay out to them.
This process can take a few days and people often end up leaving their cryptocurrency deposited in their exchange account — something that could become a problem if the exchange were to suffer a hack or other technical problems.
Coinbase will be hoping the increased accessibility of the giftcards will mean those who use the service come back and make repeated transactions.
The number of Bitcoin transactions in Europe is currently still far from highs it saw at the end of last year, according to LocalBitcoins, an international trading platform.
The Bitcoin price, which has climbed some 30% over the last 30 days, remains far under its near $20,000 highs it hit late last year but a much anticipated Bitcoin exchange traded fund in the U.S. — which many are hoping will be approved by the Securities and Exchange Commission next month — could well give another shot in the arm to cryptocurrency.
Meanwhile, some of the world’s biggest banks and financial institutions are mulling how they can best offer Bitcoin and cryptocurrency products to their customers — something which could bring a tsunami of fresh capital to the market.