BitInstant - Recent Service Disruption and New Features

[Yankee (BitInstant)]

We wanted to provide a quick update to our users and the community regarding BitInstant’s inbound and outbound payment methods, which have recently changed.

What changed?

• Cash deposits via banks has been suspended
• Payout to Bitcoin and email addresses (via Coinapult) has been suspended

The cash deposits to banks have been suspended as we’ve had a number of problems with our partner.
Until these problems are resolved, we won’t be accepting the cash deposits at banks.

It’s always been our intention to diversify away from the banks, regardless. Indeed, cash deposits are
still available via our non-bank retail locations (Walmart, 7-Eleven, CVS, etc.). Further, we are very close
to adding a host of new payment locations (non-bank) and some very exciting new payment methods
that are far superior to the bank deposits.

Regarding the removal of the payment option to Bitcoin and email addresses (via Coinapult), we know
this is highly inconvenient for many of you. Coinapult is currently building a new, far more advanced
system which acquires and sends coins out to customers, and when this is done, the feature will be
back.

Additionally, this will mean better prices for BTC conversion, faster transactions, and a more diversified
exchange environment (less reliance on one single exchange).

So, please bear with us during these growing pains over the next week or two.

TL;DR
-----
+ For cash deposits, you need to use the retail locations (not the banks) for now
+ Coinapult features (pay to email or Bitcoin address) will be back in a week or two
+ Exciting new payment methods are imminent (more cash locations plus something even more special)
+ When Coinapult is back, exchange rates will be better, with less reliance on one exchange

Thanks!
-The BitInstant Team

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[Trader Steve]

+1
Anxiously awaiting and grateful for all that you do to help make bitcoin stronger. Keep innovating!

[franky1]

+2
Very grateful for the update. Especially with all your efforts in the legal world concerning banks. and also your work at for instance Las Vegas recently and other financial venues. very much appreciate the time you guys put into bitcoin publicity.

can we also have an update on the prepaid card for withdrawal. its been a couple months. so even if you cant give a deadline date. can you atleast indicate if your stuck at 10% of the way, 50% or nearing 90%.

i have many uses for this. predominantly getting real world merchants to get a card from you so that they can advertise the linked bitcoin address in their shops and instantly accept bitcoin, knowing they will have their FIAT to pay wages and buy stock the same day (within one bitcoin transaction confirmation if i believe what i have read).

i make this next point because if merchants who don't want to keep bitcoins but desire their FIAT, will eat at the FIAT pot.

what protection will you have to avoid everyone just cashing out all their coins. and no mega purchasing of coins to reimburse the FIAT pot. Because what we all don't want to happen is, for instance 10k of people who only withdrew 200 BTC each(within whatever legal AML/KYC limits), where your left holding 2million BTC and there only being a small pot of FIAT left to represent BTC value on the markets. making BTC less then a cent each.
hopefully you will have super strict limits on spending both to prevent value dumping and of-course AML concerns.

hopefully at least on smaller accounts under the KYC threshold, (not requiring photo ID). Putting a limit on one card per household/address. would help both dumping of large amounts a single user has in one go, to avoid rapid drop in BTC value. and also going beyond what AML guidelines require of you.

separate question: a few people have shown interest and contacted yourselves about adopting litecoin, any update on this? again predominantly a litecoin address linked to a prepaid debit card, but secondly a FIAT to litecoin service.

i am a litecoin fan and if any of the your problems/delays with the card-processors are to do with the drugs cartel propoganda. then maybe litecoin debit cards would be the solution. as they haven't been stigmatised (yet, hopefully never)

hopefully next years financial get-togethers will have a litecoin logo along side bitcoin on your advertising. (me dreaming)

[zoinky]

Damn no more cash deposits at banks.  That's too bad . Excited to see the "new" deposit methods.

[justusranvier]

The cash deposits to banks have been suspended as we’ve had a number of problems with our partner.
Until these problems are resolved, we won’t be accepting the cash deposits at banks.

Based on my experience today this is a major blow to the usability of your service.

The first time I use BitInstant I took the deposit form and my money to a nearby Wells Fargo branch, was in and out in about 2 minutes, and had my bitcoins 20 minutes later.

Today I had to go to three different MoneyGram locations before somebody was able to figure out how process the transfer. The cashier at CVS directed to me to a red phone that looks like it came right of the 1980s, back when touch tone phones were still a novelty. I walked out of there. The cashier at Albertsons was helpful and sympathetic but kept getting "invalid account" errors. The cashier at WalMart did manage to do it after 10 minutes and two attempts, although I had to fill out a form that contained all the same information that was on the deposit form I brought with me and I felt like I was trapped in a "People of Walmart" image macro the entire time.

tl;dr: MoneyGram sucks. If there's any possible way to bring bank deposits your services would be much more pleasant to use.