Revolut Cryptocurrency — Six Things To Know BEFORE Buying
Revolut, one of Europes digital mobile only banks recently partnered with prominent cryptocurrency exchanges — GDAX and Bitstamp to launch their offering within the cryptocurrency space. This is a progressive move, and a further nod to cryptocurrency mainstream adoption — but is it any good?
Here’s the low down:
Revolut offers a simplified way to step into crypto for everyone within the EEA (European Economic Area) — including the UK. For those who have a Revolut account, all they have to do is update the app and they are able to purchase/sell crypto (Bitcoin, Litecoin, Ethereum) instantly, using 25 global currency pairs.
It’s currently only open to Revolut Premium customers, or those who invite three friends, however, this will open up to regular customers in the coming weeks.
You may send crypto to anyone with a Revolut account — instantly.
You may use your Revolut card to make transactions with your crypto. This occurs by them exchanging crypto for FIAT instantly.
It’s a further step in the right direction, providing legitimacy to crypto and further allowing for mass adoption. That can only be a good thing for price action of crypto.
They charge a 1.5% fee for the privilege of simplicity. This applies to FIAT > Crypto and vice versa transactions i.e. there is a 3% fee in total should you wish to withdraw to FIAT, or spend via card.
For comparison, Coinbase — the largest crypto provider with comparable simplicity, charges 1.49% for a standard buy/sell — however, they have an advantage that we will come to shortly.
Reminder: GDAX fee is ZERO!
👎🏽👎🏽 The Ugly:
You may only make transactions/transfers within Revolut. That means, you may not withdraw your crypto to an external wallet, which leads us to;
Private Key Ownership
You don’t own your private key — they are the custodian of the private key. As such, if you don’t own it do you really own anything!?
You are at the mercy of the confines of Revolut and their system. Coinbase has a similar set up and you don’t own your private key when using their service either, however, they do allow you to withdraw to an external wallet — which I feel is crucial.
Reminder: Bitcoin/Blockchain’s very essence is decentralisation, individual sovereignty and transparency!
Additionally, the crypto that you are purchasing is not being recorded on the blockchain. As such, you are unable to utilise one of the fantastic aspects of cryptocurrency, which is to be able to have a transparent view of the transactions flowing through the system.
Instead, Revolut have their own internal ledger recording crypto transactions, which provides further centralisation.
Revolut also highlights the fact that cryptocurrencies are not regulated in the UK/EEA (at the moment), and therefore; “Any cryptocurrency we hold for you is not covered by the Financial Services Compensation Scheme.”
Whilst this is the case for all cryptocurrency service providers in the UK at the present time, one advantage of using Coinbase and/or GDAX to purchase your crypto, is that they are heavily insured should they be hacked. Revolut hasn’t provided details of their risk profile.
It’s fantastic to see crypto adoption, however, I won’t be using Revolut to buy or sell my crypto. I feel it is too restrictive and does not align with the fundamental attributes of cryptocurrencies. Something that you should consider, whether it’s Revolut or any other crypto service provider.
Revolut does however, continue to provide a fantastic way to exchange funds into other FIAT currencies, to then transfer to another crypto exchange e.g. using GDAX/Coinbase to purchase crypto or withdraw profits with zero fees and near perfect FIAT exchange rates.
If you found the information useful, give us a clap — share with anyone who might find it useful.
A Game of Coins — Created to share:
Cryptocurrency| Trends | Trading | Investing | Data Analytics