BitPay -- KYC is here!

[malevolent]

i just bought a $100 amazon gift card through the bitpay wallet a few moments ago. no KYC required. also bought $500 in gift cards ~12 hours ago on egifter through bitpay---same.

Do you think Bitpay could have found enough information about you through one of the many possible channels such that they decided not to bother to ask you for KYC?

[pugman]

if i can't get amazon gift cards through the bitpay wallet anymore, the only other consistent option will be bitrefill, and they charge a pretty big markup.

What prices are BitPay charging for their cards? I've never found Bitrefill prices to be that expensive. At the moment, a $500 Amazon card works out to around $503 worth of bitcoin, but with the 1% reward that they offer that comes out at $498. You can even get up to 5-6% back on some other retailers, which makes their cards work out pretty cheap indeed.

Another use from the BCash subreddit seems to be reporting the same thing recently. Using BitPay to try to pay for food delivery and being met with KYC demands - https://www.reddit.com/r/btc/comments/ksjbld/bitpay_now_requiring_full_kyc_info_to_pay_for/

Weird. In my region at least, its pretty darn expensive. For 100 USD of Amazon card, I have pay around 125-133 USD$ worth of btc. Same goes for netflix and other gift cards, I would have to pay 25% more of what the actual value of the gift card is. feelsBadMan.

Either I am incredibly wrong somewhere, or its just my region pricing.

[figmentofmyass]

i just bought a $100 amazon gift card through the bitpay wallet a few moments ago. no KYC required. also bought $500 in gift cards ~12 hours ago on egifter through bitpay---same.

Do you think Bitpay could have found enough information about you through one of the many possible channels such that they decided not to bother to ask you for KYC?

that seems rather doubtful. i've never used bitpay to pay a service where i've KYC'd, and i really don't think browser/IP/blockchain analysis is a functional replacement for a KYC program that demands official photo ID. i don't think a legal compliance-minded company like bitpay would operate that way, but i could be wrong.

i have a couple theories:

1. they are rolling out region-specific policies based on things like IP address and it's not clear yet which regions are affected
2. they had not/have not fully rolled these policies out, so there are inconsistencies happening right now

we'll probably know a lot more in a couple weeks as more reports come out.

[malevolent]

that seems rather doubtful. i've never used bitpay to pay a service where i've KYC'd, and i really don't think browser/IP/blockchain analysis is a functional replacement for a KYC program that demands official photo ID. i don't think a legal compliance-minded company like bitpay would operate that way, but i could be wrong.

Some people report having to undergo KYC, some don't, perhaps what's happening is they demand KYC of people whose activity they deem "suspicious" and leave others alone (below certain transaction thresholds), or vice versa, they treat everyone with suspicion, except those who would have unmasked themselves in some way (again, only for smaller transactions).

we'll probably know a lot more in a couple weeks as more reports come out.

Yes, more data points should give a clearer picture.

[PrimeNumber7]

i just bought a $100 amazon gift card through the bitpay wallet a few moments ago. no KYC required. also bought $500 in gift cards ~12 hours ago on egifter through bitpay---same.

Do you think Bitpay could have found enough information about you through one of the many possible channels such that they decided not to bother to ask you for KYC?

This is almost certainly not the case. Either they have KYC information, or they don't. It is possible their software is not properly written to request KYC for customers when their policy says it should.

if i can't get amazon gift cards through the bitpay wallet anymore, the only other consistent option will be bitrefill, and they charge a pretty big markup.

What prices are BitPay charging for their cards? I've never found Bitrefill prices to be that expensive. At the moment, a $500 Amazon card works out to around $503 worth of bitcoin, but with the 1% reward that they offer that comes out at $498. You can even get up to 5-6% back on some other retailers, which makes their cards work out pretty cheap indeed.

Another use from the BCash subreddit seems to be reporting the same thing recently. Using BitPay to try to pay for food delivery and being met with KYC demands - https://www.reddit.com/r/btc/comments/ksjbld/bitpay_now_requiring_full_kyc_info_to_pay_for/

Weird. In my region at least, its pretty darn expensive. For 100 USD of Amazon card, I have pay around 125-133 USD$ worth of btc. Same goes for netflix and other gift cards, I would have to pay 25% more of what the actual value of the gift card is. feelsBadMan.

Either I am incredibly wrong somewhere, or its just my region pricing.

Some gift cards they are selling have strangely high markup pricing. 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.

I would think Netflix and Amazon would not meet the above criteria though.

[FinneysTrueVision]

As far as I know when you get to the payment invoice you can just continue as a guest and continue without any verification. A BitPay ID doesn't mean you have to KYC. It is just an email verified account that keeps track of all your purchases and is required for requesting a refund.

[malevolent]

This is almost certainly not the case. Either they have KYC information, or they don't. It is possible their software is not properly written to request KYC for customers when their policy says it should.

Given how some services only ask for KYC if there's something they don't like, such as, but not limited to, IP address provenance, or blockchain activity, it wouldn't at all surprise me. Of course I'm still talking about transactions below a certain threshold.

[o_e_l_e_o]

or its just my region pricing.

That's the price you pay for not living in the US. Don't you know we're the only country that matters!? (/s)

There is a thread of other gift card providers here: Gift cards providers. Perhaps you could find one with better pricing for your region.

that seems rather doubtful. i've never used bitpay to pay a service where i've KYC'd, and i really don't think browser/IP/blockchain analysis is a functional replacement for a KYC program that demands official photo ID.

I would agree with this. Considering BitPay say they are doing this to comply with various AML laws from various governments, I highly doubt that those governments would say "Yeah, non-perfect and easily fooled blockchain analysis is sufficient" when they can just as easily say "Everyone must upload their passport".

Found a response on Reddit from a BitPay staff member: https://www.reddit.com/r/btc/comments/kvujzq/fck_bitpay_use_coingate/gj0w8se/. It seems like they have introduced or are introducing mandatory KYC for all EU customers, regardless of value of transaction.

[malevolent]

Found a response on Reddit from a BitPay staff member: https://www.reddit.com/r/btc/comments/kvujzq/fck_bitpay_use_coingate/gj0w8se/. It seems like they have introduced or are introducing mandatory KYC for all EU customers, regardless of value of transaction.

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.

[o_e_l_e_o]

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.

BitPay have always gone far beyond what regulations or laws have required them to do in terms of KYC and privacy invasion. There are a bunch of other gift card providers on the thread I linked above which serve EU customers, and I've not heard anything about new KYC requirements for any of them. Similarly, there are a bunch of alternative payment processors to BitPay, and again, I've not heard anything about new KYC requirements for any of them.

I'm not a European customer so I cannot confirm though. Perhaps someone who is and has made some purchases recently through non-BitPay means could say if there was any difference or any hints of KYC?

At the end of the day, KYC for any and every payment, no matter how small (getting KYCed to buy a pizza!) is utterly ridiculous. We should not be OK with this.

[figmentofmyass]

Found a response on Reddit from a BitPay staff member: https://www.reddit.com/r/btc/comments/kvujzq/fck_bitpay_use_coingate/gj0w8se/. It seems like they have introduced or are introducing mandatory KYC for all EU customers, regardless of value of transaction.

phew! i'm in the states. that explains it. thank you for sharing the link.

not that i don't expect similar policies to be rolled out in the USA---i do. i'm just enjoying the non-KYC situation while we still have it.

At the end of the day, KYC for any and every payment, no matter how small (getting KYCed to buy a pizza!) is utterly ridiculous. We should not be OK with this.

i don't know the intricacies of AMLD5 but i think it mandated a €50 limit on anonymous payment methods. IIRC even EU-based faucets and tipping services shut down because of it. so i'm not entirely surprised. brutal...

[PrimeNumber7]

This is almost certainly not the case. Either they have KYC information, or they don't. It is possible their software is not properly written to request KYC for customers when their policy says it should.

Given how some services only ask for KYC if there's something they don't like, such as, but not limited to, IP address provenance, or blockchain activity, it wouldn't at all surprise me. Of course I'm still talking about transactions below a certain threshold.

It seems they have different policies based on the user's location, so they may require KYC verification based on some criteria that determines the location of the user. This could be based on the user's IP address, or it could be something else, such as a representation from the merchant.

[FinneysTrueVision]

i don't know the intricacies of AMLD5 but i think it mandated a €50 limit on anonymous payment methods. IIRC even EU-based faucets and tipping services shut down because of it. so i'm not entirely surprised. brutal...

That is a really stupid law if it is true. A gift card is an anonymous payment method. It is more private than using Bitcoin in most circumstances. Does that mean that Amazon is going to start KYCing customers who pay with gift cards?

[squatter]

i don't know the intricacies of AMLD5 but i think it mandated a €50 limit on anonymous payment methods. IIRC even EU-based faucets and tipping services shut down because of it. so i'm not entirely surprised. brutal...

That is a really stupid law if it is true. A gift card is an anonymous payment method. It is more private than using Bitcoin in most circumstances. Does that mean that Amazon is going to start KYCing customers who pay with gift cards?

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.

Regardless, Amazon has already begun requiring KYC for gift card redemption, although I think it's for fraud and loss prevention more so than money transmission law. You need a linked credit card or bank account (and in the US a verified address), otherwise your account is likely to be locked after gift card redemption. Notice the warnings that Bitrefill now posts on its Amazon gift card pages:

The redeeming Amazon.com account is required to have a second payment method added (Credit cards/Bank accounts) and a verified USA address.

[LoyceV]

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).

Found a response on Reddit from a BitPay staff member: https://www.reddit.com/r/btc/comments/kvujzq/fck_bitpay_use_coingate/gj0w8se/. It seems like they have introduced or are introducing mandatory KYC for all EU customers, regardless of value of transaction.

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?

[shield132]

Found a response on Reddit from a BitPay staff member: https://www.reddit.com/r/btc/comments/kvujzq/fck_bitpay_use_coingate/gj0w8se/. It seems like they have introduced or are introducing mandatory KYC for all EU customers, regardless of value of transaction.

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?

I think it would be better to choose other countries than Mexico
Personally, I can't understand the one thing: There is BitPay and there is BTCPay with zero fees. Why would someone use BitPay over BTCPay? I think BitPay also knows that BTCPay exists, so there is higher competition for them but instead of making things easier, they are making everything very hard and crypto unfriendly. Logically, this should destroy their business. Asking KYC for transactions is very unethical and disgusting. Isn't it my right to protect my privacy? And then governments tell us about how your free will is protected by the law.

Conclusion: This world is shit (most likely we make it shit), full of lies where people are still slaves, where people are just a toy for marketers and data analysts, eh...

[malevolent]

Personally, I can't understand the one thing: There is BitPay and there is BTCPay with zero fees. Why would someone use BitPay over BTCPay? I think BitPay also knows that BTCPay exists, so there is higher competition for them but instead of making things easier, they are making everything very hard and crypto unfriendly. Logically, this should destroy their business. Asking KYC for transactions is very unethical and disgusting.

BitPay has first mover's advantage and they make it easier (in theory) to accept fiat. In reality the users transfers the risk of freezing funds from an exchange to BitPay.

Relevant links:
https://github.com/btcpayserver/btcTransmuter
https://medium.com/@prayankgahlot/instant-fiat-conversion-with-btcpay-1d2f3dd57352

Isn't it my right to protect my privacy?

Statists' aspirations ≫ privacy for the individual

[squatter]

Has anyone come across reports of this happening in the US -- or for that matter, anywhere outside of Europe or European IP ranges? I've seen a couple more posts like this. All signs that I've seen so far still point to an EU-specific policy.

I would test it myself, except I really don't want to sell any bitcoins right now.

[PrimeNumber7]

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.

THis may be true, but I also think that in general, if a merchant is selling a lot of gift cards to a single customer, they will offer a better deal.

(getting KYCed to buy a pizza!) is utterly ridiculous.

Isn't it enough the pizza guy knows where to bring it?

I actually somewhat understand this. Buying a pizza and giving a very large tip via bitcoin might be a way to launder money, which is what KYC is supposed to prevent track.

[o_e_l_e_o]

There is BitPay and there is BTCPay with zero fees. Why would someone use BitPay over BTCPay?

BitPay allows a merchant to accept bitcoin on their website, but receive fiat to their bank account. BTCPay, by virtue of being self hosted and non-custodial, does not. BTCPay users (at the moment) have to manually set up automatic fiat conversion using an exchange or other third party.

Has anyone come across reports of this happening in the US -- or for that matter, anywhere outside of Europe or European IP ranges?

There is this user - https://bitcointalk.org/index.php?topic=5310416.msg56133269#msg56133269 - who says he was hit with KYC demands despite being outside the EU, although he does say he uses different IPs so perhaps he used a European VPN server or Tor exit node.

Buying a pizza and giving a very large tip via bitcoin might be a way to launder money, which is what KYC is supposed to prevent track.

The same could be said of paying in cash, and even more so by paying in cash in a restaurant or picking up food in person without giving out a name or address as you would with home delivery. And yet, no one trys to make you KYC for this.