it's actually been quite a while since i've used bitrefill. i remembered the markup being ~2% many months ago, but it's ~0.8% now. that's not accounting for the 1% bonus either---not bad at all.
Bitrefill's markup
varies per gift card. For small gift cards I don't really care, as long as I don't have to pay a hefty on-chain consolidation fee.
If you are comfortable trusting Bitrefill to hold some funds on your behalf, then you can always top up your account with some bitcoin when transactions fees are low, which will allow you to purchase cards instantly at a future date.
My preferred method nowadays is to fund
a LN-wallet when on-chain
fees are low, and use LN to pay Bitrefill when I need it.
My guess is they sell those gift cards in a low enough of a volume that costs associated with procuring the gift cards is so high they need to charge more.
My guess is some merchants give them a better price for the gift card, for instance clothes sellers that have a large profit margin.
I think they're being overly cautious, though, small transactions up to 150 EUR/month should be excluded, and there are ways of avoiding even that for businesses like Bitpay in some circumstances, unless the Netherlands, where Bitpay's EU HQ are located, has decided to implement the directive more stringently.
The Dutch National Bank has implemented stricter crypto-regulations than required by EU, see
Bitonic.nl.
(getting KYCed to buy a pizza!) is utterly ridiculous.
Isn't it enough the pizza guy knows where to bring it?
My impression is that the AML/KYC requirements kick in when money -- including bitcoin -- is exchanged for gift cards, not when gift cards are redeemed at the issuer.
In the Netherlands, the most common gift card (VVV) is treated as an anonymous prepaid creditcard (
info in Dutch). That means you can't pay more than €50 at once online.
I use crypto to pay for 3 different webhosts, and
one of them has no other option than Bitpay. I haven't been hit by KYC on BitPay yet, and I'd hate to lose this host over this. I specifically choose Bitcoin for privacy, otherwise I could just pay by creditcard (which is less intrusive than sending selfies).
Update: I checked, the webhost uses CoinPayments.net, so I'm good (for now).
If only more people would care and ignore them. They can probably afford to lose a small percentage of their customers, but if they'd lose 95% of their business, they might change their requirements.
If it's for EU: would a VPN in Mexico work?