[idea] Selling bitcoin cards locally

[Elwar]

So I'm sitting here in Thailand at a bar and about every 30 minutes someone with a small set of merchandise walks by my table and offers to sell me something (fake watches, makeup, cialis, etc.).

It got me thinking of how that could be done with bitcoin.

My thought is to have a website where you print out bitcoin cards similar to how some countries do prepaid minutes on phone cards. The card would be valued at $10, $20, $100, etc. There is a scratch off portion with a number underneath. When the person sells the card they scan a code on the card to show that it has been sold. The buyer then scratches off the number and goes to the website provided. The website can then see that the number was sold and when the person claims the number it converts the amount purchased into bitcoins stored on the person's wallet on the website. Then the person can just withdraw the bitcoins to whatever wallet they want.

The exchange rate would be marked up about 10% to make profit. The rate could be set this way because this would be more for novelty and convenience than any real investing. Just so someone can say "I have $10 worth of bitcoins!". The person going out and doing the selling can get 5-8%, the website gets the other portion, or even 0% if they just make their money on advertising or withdrawal fees or just price gain of bitcoin over time.


I figured instead of going through the process of becoming a bitcoin exchange and registering and all of that, the website can just require that the purchaser pay in bitcoins for the amount of money on the cards. The website never sees fiat, they are only releasing a fiat denominated amount of bitcoins to people. That way they never have to have a bank account and can duplicate this for all currencies all over the world. The seller will need to convert from their local currency to bitcoins, but they will be able to do it at a lower rate either through an exchange or localbitcoins. The website can even assist people with that process by providing them a localbitcoins partner who will take bank transfers and send the bitcoins to the website.

The risk is that the bitcoin price drops over a long enough period that the website cannot cover the fiat value over time. But there is little risk that in the long term bitcoin value will go down as compared to the value of fiat.

It might even be possible to do this with a Rootstock smart contract so there is no central company to be targeted by regulators that are under the thumb of banks.

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[waiberz]

That's a good idea. Seems the problem with it is to lost the card and or stolen. They can easily scratch it out to get the code. But to add maybe should also get a confirmation from the seller and notify in applications to verified.
It is now easy to them to buy bitcoin or ethereum using scratch card. 

[Elwar]

That's a good idea. Seems the problem with it is to lost the card and or stolen. They can easily scratch it out to get the code. But to add maybe should also get a confirmation from the seller and notify in applications to verified.
It is now easy to them to buy bitcoin or ethereum using scratch card.  

Yes, the seller would have to have an app to tell the website that a card was sold. Otherwise the website will not release the coins. So someone could steal all of the cards and they would get nothing. This is how the phone cards work in some countries.

I suppose there can be some sort of re-issuance of cards to the seller if they are stolen (at the seller's expense). The numbers on the original cards will be frozen and new numbers created.


I suppose the seller could be an asshole and just sell the cards without informing the website. But this does not benefit the seller in any way and only pisses off the buyer. And complaints about that seller could have him banned or somesuch. It just wouldn't make business sense.

[redpillorblue]

Amazing idea.

Maybe there can be just a Smart Contract that yields out crypto currency only when 2 keys match. 1 of them can be scratch code from the card, and one seller ID. The 2 keys basically unlock the wallet of the seller, where crypto associated to the seller is quarantined (the total amount of money he bought in total from the exchange, that is) and he can send any amount to the buyer he wishes (as per the current exchange rate or even giving up his own commission shall he wish).

So, even if the cards are stolen, they have no value till seller code is applied to unlock the wallet (working as a 2FA in this case). And seller sells his own inventory from the exchange and nothing else.... so they would be careful in transactions and cant touch the exchange money.

I can help you setup this smart contract.

[Elwar]

Amazing idea.

Maybe there can be just a Smart Contract that yields out crypto currency only when 2 keys match. 1 of them can be scratch code from the card, and one seller ID. The 2 keys basically unlock the wallet of the seller, where crypto associated to the seller is quarantined (the total amount of money he bought in total from the exchange, that is) and he can send any amount to the buyer he wishes (as per the current exchange rate or even giving up his own commission shall he wish).

So, even if the cards are stolen, they have no value till seller code is applied to unlock the wallet (working as a 2FA in this case). And seller sells his own inventory from the exchange and nothing else.... so they would be careful in transactions and cant touch the exchange money.

I can help you setup this smart contract.

2 factor is certainly a good idea