Topic: Buying crypto with Paypal or CC. Why so complicated and fugged? (Read 1206 times)

How come virwox manages to do it  with both credit cards and paypal? Granted, there's a nuisance of a Second Life currency in the middle... Maybe they factor the risks into the fees and they limit the amounts you can buy to the minimum...

Here is a simple example:

Fred buys $1000 worth of bitcoins from you using a stolen credit card. Then, the credit card is reported as stolen. The CC company cancels the $1000 charge to the owner and their $1000 payment to you.

Fred has the bitcoins and you have nothing.


The same thing happens if you go through Paypal:

Fred buys $1000 worth of bitcoins from you through Paypal, using a stolen credit card. Then, the credit card is reported as stolen. The CC company cancels the $1000 charge to the owner and their $1000 payment to Paypal, and Paypal cancels their $1000 payment to you.

Fred has the bitcoins and you have nothing.

With PayPal your money is "soft". Chargeback I believe is a fairly self explanatory term. you can send another user let's say $100 via PyPal and then 3 months later contact customer services and request they return the funds to you as part of their consumer protection. PayPal will always favor their own user in this case as the funds are digital goods there is no evidence of shipment.

Since Bitcoin by it's very nature has no centralised authority there is no 'customer service' to contact and request the money is returned, meaning it is absolutely ripe for abuse by those who purchase stolen paypal accounts and want to easily launder their money and hide their tracks.

What do you mean, by 'charge-back' ?

This question is the same as asking why newspapers don't help bloggers get their online articles published. Okay, not a perfect analogy but the point still holds. Yes, places like paypal and visa can make money now organizing an online crypto marketplace, but they would be building the blocks of their own demise. I doubt it will happen anytime soon.

i spoke with paypal for over 2 hours today about this subject, not once did they say anyone dealing with bitcoin would have their accounts closed.

I have been trying to find payment systems that allow for the purchase of crytpo currency as We are almost ready to launch a crypto only auction site.

Paypal said its the banks and Credit card company's who are doing the charge-backs not them, they said i could use Paypal on the site but they offer no protection as its digital item. so i questioned further how i could protect my customers from scammers. The advisor said you need to provide solid evidence of whole transaction when submitting to the banks to stop the charge-back. so i suggested to state in the terms and conditions of our site that all members must accept all auctions are digital items that will be sent digitally to their wallet and the blockchain transaction is proof of delivery. Then if any charge-backs occur after a sale we have proof of order and delivery.   

Skrill got back to me and said they wont have anything to do with Bitcoin related sites as it breaches there terms and conditions.

I would like to think with a good site and community we could use paypal quiet happily for Crypto. its only the bad eggs letting the team down by scamming and we will not tolerate any scammers on our site.

Cryptocurrency it's stealing their food in front of their face . Simple as that . Mastercard & Visa aren't 2 friendly guys rulled by the community and the fee's aren't going back into the community so they are going to lose big time anyway it's matter of merchants and how world will develop in the next couple of years .

Cause paypal and cc hates crypto

I know fraud is there with CC. But why no one risk accepting credit card especially for bitcoin?

Fraud through Paypal and credit cards is rampant. Bitcoin sellers are especially vulnerable because bitcoin transactions cannot be reversed. If you want to buy bitcoins with a credit card, the easiest way is to get a cash advance and buy the bitcoins with the cash using Coinbase or LocalBitcoins.

virwox.com does accept PayPal with very high fees and limited amounts. You need to transfer money using Paypal or a CC,  buy SLL first (it's their currency for the Second Life game AFAIK) and then convert it to BTC. It's fast but expensive and the limits are low. I wish I came up with that business plan.

As ProfMac said, Don't do anything with paypal, paypal staff have confirmed they are under orders to kill any account havinig to do with cryptos presumably because they are direct competition to paypal.

PayPal says that crypto is against their ToS.  They cancel accounts.

The chargebacks make it complicated.  These guys let you pay with cc once you go through the verification process, I haven't actually used it yet but I submitted my documents and got approved to buy..  meetpays.com  Look for some reviews first though, like I said I haven't used them.  (I'm in Vancouver so I just use the ATM)

Yeah.. I know it must sound newb to you!

But why nobody is selling crypto with a simple cart system accepting CC or paypal?


P.S. Don't tell me that linking your trading account with a strange paiement system or buying some overpriced linden dollars plus exchanging them to crypto for 20-30% exchange fees are reasonable ways to do it.