Bitcoin Forum

Hey! I did a lot of thinking & this thread is a follow up to the one I posted a few days ago here.
https://bitcointalk.org/index.php?topic=1347010.0

bitcoin business idea

create a service that allows people to turn their cash into bitcoin within minutes w/ no verification at all. Get bitcoin in front of the average daily consumer. Charge 5% above BTC price as my profit


1). credit cards, prepaid card, debit cards
In this business model visitors would be able to buy bitcoin on my website using their credit cards
The Pros
   -very easy to use
   -very accessible
   -extremely simple
   -very fast, user get bitcoins instantly
The Cons
   -massive legal issues
   -taxes
   -website & bitcoin security
   -massive fraud & chargebacks if I offer this with no ID verification
   -high credit processing fees
   -FinCE MSB license, and money transmitter license VERY expensive for all 50 states
   -too many expensive problems
   -doesn’t really get bitcoin in front of the “average consumer"

2). cash deposits
In this business model visitors would be able to buy bitcoin by depositing cash in amounts less than $3,000 in a business bank account, with no ID, and would receive coins in 2 hours
The Pros
   -very easy
   -very accessible
   -extremely simple
   -quick process
   -no ID verification required
The Cons
   -probably massive legal issues
   -even with a business bank account, if I start getting a few hundred bank deposits from $1-$3k that will    raise some big red flags
   -FinCE MSB license, and money transmitter license VERY expensive for all 50 states
   -taxes
   -will have to handle these manually, it will be frustrating to have to go to my computer every 10 seconds    to send bitcoin from storage


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3). Store card bitcoin purchase

You know when you go to a convenience store like CVS and Walgreens & you see the kiosks with gift cards like Xbox One points, Best buy gift card, Green Dot Money paks etc? You also see smaller kiosks by the front register.

This is is exactly what I want to do. My idea is to create my own cards like these that allow you to buy “FIAT Credits” for my website. The limits would be $20-$999 purchase.

The Example:

The card itself would cost $1.50 & You would go the resister and load it from $20-$999, let’s say you have $600. You have loaded $600 onto the card, and purchase credits. It would go as $1 = 1 FIAT credit. (The card would have instructions also)

You would then go to the website, create an account & enter your number on the back of the card.

Once you do this your $600 would show up as “FIAT credits” not actual cash.

Lastly, once inside the site. You will be able to instantly convert your credits to bitcoin. The credits would basically act as cash. Again, $1 USD = $1 FIAT credit (For the USA, it would be done as the equivalent in other currencies).

****I would also allow purchase of these cards online. If someone try’s to commit fraud with stolen credit card information. I would know within a few days & I will just void the gift card numbers that they purchased online before they arrive. For that reason, I would not offer overnight shipping for online card purchases.

You could also purchase FIAT credit by bank transfer. Once received by us and verified, your account will be filled with your purchased FIAT credits***

Limits:

-Convert up to 3,000 FIAT credits per day into bitcoin. Anything more would require an ID verification & bank account verification. But once you are fully verified you would be allowed to convert up to 30,000 FIAT credits per day.
-Buy up to 20,000 FIAT credits per bank transfer with no id what-so ever.  Anything more would require an ID verification & bank account verification. But once you are fully verified you would be allowed to buy up to 50,000 FIAT credits per transfer.

The Pros
-VERY easy
-VERY simple
-I make money selling the cards & selling the bitcoin itself
-Since we would be in stores like CVS, Walmart, Walgreens. Bitcoin would get in front of the eyes of many “average” consumers
-taxes would be a lot lower, Just sales tax on the $1.50 card purchase. And regular business taxes. Whatever you loaded would be credited towards the card
-no id needed for regular purchases, it would be needed for larger purchases

The Cons
-not sure, but it might be harder to get into stores like Walmart & CVS

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Let me know what you think! Would like some input on this!

It would be nice to have quicker ways of receivin bitcoin but honestly you will just end up with a lot of fradulent charges and most likely legal issues too.

True, but the man who figures out a way to make credit card purchases of bitcoin work somehow (legal, fraud, security). Is going to make a freaking fortune

What about places like Circle?  I assume you don't mean debit card but credit card, and I would say that it's silly (in my humble opinion) to buy bitcoin with a credit card.  It's like buying stocks with a credit card almost, but whatever.  People trade on margin all the time, but that can be dangerous.  In any case, what you're suggesting is kinda sorta already being done, no? 

would there be an option to buy paper wallet instead en exchange of cash?
I would prefer buying such to you when you're up as I don't have to show my IDs, is this possible? I think a lot us will most likely prefer or want to do this as well. so they can jsut scan the qr code thru thier mobile apps.

i liked your goal, of letting people exchange their cash into bitcoin fast and without the bullshit verification. but despite being good it has a big flaw that you already know and are mentioning it in your cons, which is scammers which will try and use this service to turn their illegal cash (like from stolen credit cards) into untraceable bitcoin.

on top of that, your maid idea has a big fee of 5% which i think is going to be a problem in the future for getting people on board.

haven't seen it done anywhere. I have never gone to ANY store any have seen any cards that allow you purchase bitcoin, as easily as this with no ID. Have you?

I think you can get paper wallets with bitcoin loaded on them on places like Ebay.  Not sure who else has those, but  you have to trust whoever's making the wallet not to have the private key written down somewhere else.  For those of us who are paranoid to the max, that's unacceptable.  And yeah, as I said above you can buy btc at places like Circle but forget about it if you want to remain anonymous.

Coinbase and Circle already have. You seem to want to sell bitcoin in quantity while skirting around KYC and AML requirements, yes? Good luck with that.

There are problems with any idea, my friend. Nothing is perfect. It will take work!

Not all ideas are workable, and you need the counsel of a good attorney familiar with bitcoin.

Yes, but believe I can make this work. Everything I wrote above is not set in stone, obviously. This is just an idea my friend.

It would work, if you could keep the payment in Escrow until the bitcoin on the prepaid card is transferred to another Bitcoin address. The person who accepts the money for the prepaid card serve as the middle man between the seller and the buyer.

Once the bitcoins are moved from the prepaid card, the middle man <Escrow> release the funds to the seller. If the buyer are unhappy, they go to the Escrow and redeem the fiat and return the prepaid card. The transaction can be done on mobile phones with the escrow present.

A percentage of the prepaid card cost can go towards the escrow, similar to the exchange fees.

yes I was thinking about offering this actually

xapo have a credit card that you can link to your acount , but then you have to have btc deposited to your acount in the first place , and dont know if you can convert your btc when you use the card , so you can buy in normal stores with it.

I never really liked xapo. Most of all i want to get rid of the bullshit when it comes to buying bitcoins, and this will not be an easy task :(

I did the opposite of what you are trying to do.  The money moves pretty fast.  I never had enough to meet demand.  KYC rulings coming into play, encouraged me to back out.  Good luck on your endeavors.

I'm not trying to be mean here but if you think you have such a good idea why would you share it here like this in the open? Why not keep it to yourself and just implement it?

the really problem is make a script that allow this operation.... the idea is not bad, but I think build a code for this is really hard !
and expensive! and this is why a project like this could fall easily

people can walk into walmart and buy maybe an amazon card..
go to purse.io and other giftcard selling websites and trade that card in for bitcoin.

the funny thing is that purse.io has about a 30% premium.
EG
$100 giftcard is only offered $70 of bitcoins. and people are actually selling their giftcards for those low amounts
they then sell that $100 giftcard on for <$90 (yes bitcoin customers get a discount/bargain) and purse.io still makes upto 20% in the middle

i would say however, trying to get your own 'giftcard' on the shelves/racking of the major retailers is going to be the hardest thing you will ever do in your life.
i would suggest you research into purse.io business plan and ask them some questions. as they are far ahead in the bitcoin<->giftcard industry.

http://karmakoin.com/

I've seen these online gaming points cards sold in small stores in the middle of nowhere, and it's just for low-budget MMO games made by a company called Nexon.  I don't know how hard it was for them to get carried by all these grocery store chains and convenience stores, but if they can do it then Bitcoin should be there too.

And their website says:  "Karma Koin gets your cash online so you can buy what you want, when you want, without having to use a credit card."   

Right.  Get your cash online, as long as you're spending money on pay-to-play MMO games. 

What if we could get our cash online with Bitcoin instead?

You might be onto something. I would appreciate just a little more research into the matter. Thank you.

You think some will just read this thread and implement it? There are a world of problems and complications to this business but it is workable. So, no I am not worried about someone stealing this idea for them selves

If this is really your revolutionary idea, why would you share with 100k people on this forum?

I m not from the US so I do not know how these cards and kiosks work.

As I was saying, I'm not trying to be mean about it, but the truth is, and you have to agree with this, is that an idea is 50% of a project if not more. Anyone can do things but great ideas as not so easy to get.

well even if someone does steal it Ali can then let others do the hard work and then he can get employed by them. that way he gets a payday without the headache.

sometimes going it alone is risky. and many people have let their projects go to other people and then the idea-man gets employed as an R&D, troubleshooter, consultant or what not.

Yeah buddy, we're the same war (with country laws and development barriers)... I'm planning to do a thing like that, but I'm afraid to be busted by feds... they don't bother with big people cheating but small people like us, is what they need to survive. Sad but true.

What about attaching to a network that already deals with moving money? LibertyX did this debit/PIN sellers. You go to a place that sells cell phone top-ups and get a pin. You are then supposed to get BTC. I tried using them but had issues. I think their idea can be improved.

Paysafecard is one such network.  

OT - To all those saying why share your ideas - Ideas are worth nothing if there is no execution.

Well, many banks for sure will earn a lot of millions with BTC transfers to FIAT and back. This is BTC future ;D