A Deeper Look into the Skrill cryptocurrency TOS

[Pmalek]

In October 2020, I wrote A look at PayPal’s TOS, and What it Means for Users to let the Bitcointalk community know what exactly PayPal is offering its users. Since the payment processor, Skrill, provides a similar service since July 2018, I have decided to take a look at their offer as well.
 
Let us first take a look at the official press release that states that users are only buying interests in specific cryptocurrencies and not the real asset. Just like with PayPal, it is not possible to purchase goods or services from official merchants. They are planning to introduce that option sometimes in the future.
 

At this stage, customers will only be able to buy and sell interests in cryptocurrency and will not be able to transfer their cryptocurrency holding to other Skrill customers or use it to transact with merchants. This service will be added in the future.

Update: The Cryptocurrency TOS now state that it is possible to transfer your interests to other customers/users. More on that a bit later.


Who is this service for?
 
Compared to PayPal’s service, which is currently only available for US customers, Skrill’s crypto service doesn’t accept citizens from the US, but accepts residents from the following countries:
 

Australia, Argentina, Austria, Belgium, Brazil, Bulgaria, Canada, Colombia, Croatia, Cyprus, Czech Republic, Denmark, Finland, France, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Luxembourg, Malta, Mexico, Netherlands, Norway, Peru, Poland, Portugal, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, UAE and the UK.

These cryptocurrency interests can be purchased on Skrill:
 
Bitcoin
Bitcoin Cash
Dash
EOS
Ethereum
Ethereum Classic
Kyber Network
Litecoin
Tezos
Stellar  
XRP
0x
 
Supported trading pairs for crypto-to-crypto transactions:
 
LTC/BTC
XRP/BTC
ETH/BTC
BCH/BTC
ETC/BTC
XLM/BTC
EOS/BTC
ZRX/BTC


Skrill enables you to do the following with your Skrill account:
 
- You can purchase interests in a cryptocurrency with the money from your Skrill account, or buy interests in additional cryptocurrencies using the purchased crypto on Skrill.
- Sell your interests in cryptocurrencies back to Skrill in exchange for fiat or interests in other cryptocurrencies.
 
Users will be able to transfer their interests to other Skrill customers or receive interests from other users. This is one area where Skrill differs from PayPal, who doesn’t have this option of exchanging the interests for crypto assets.

- In February 2021, Skrill introduced a new feature that allows its users to withdraw bitcoin and ethereum from Skrill to the customer's private wallet. This option will first be available in the EU and from their they plan to expand to the UK and other parts of the world.   

The Cryptocurrency Service enables you to:
 
3.1.4. transfer your interest(s) in one or more Supported Cryptocurrencies to an Existing Customer(s); and
 
3.1.5. receive transfers of interest(s) in one or more Supported Cryptocurrencies from an Existing Customer(s).”

Once your purchase is completed, Skrill will hold the purchased interests on your behalf pooled together with the interests of all other Skrill users. That means you will never own the real assets or have access to the private keys protecting them. Only Skrill will.
 
Skrill has included an Alerts feature where users will be notified when a crypto asset reaches a specific price range. This only serves to inform the user, and you can’t configure an automatic buy/sell order using the alerts feature.

Fees
 
When users transfer their crypto interests to other Skrill customers, they will be charged a transaction fee.
 
- For a P2P transaction to another Skrill user, the customer pays a fee of 0.50% of the total transaction.  
- A buy/sell order up to €19.99 includes a few of €0.99 per transaction.
- A buy/sell order between €20 - €99.99 includes a fee of €1.99 per transaction.
- Buy/Sell orders above €100 include fees of 1.50% per transaction.
Source
 
*If your Skrill account is denominated in a different currency other than euro, Skrill will apply an additional ‘foreign exchange fee’ of 1.5% to your crypto transaction. More about that here.  

Users can submit an ‘Automated order’ which triggers a buy or sell order when the price reaches a certain point.
 
Skrill also has a feature they call a ‘Recurring Order’. This option allows users to choose an amount, and buy crypto interests at several different intervals until the full amount is reached. For example, you can set aside $10 every Monday to purchase interests in bitcoin until you get to a total sum of $100 worth of bitcoin. Read more about Recurring Orders here.


Some of the things you can’t do with the Skrill crypto interests:
 
- Buy from official merchants using your purchased crypto interests.
- Upload or spend your crypto interests via Skrill Mastercards.
- Transfer crypto assets to your Skrill account from a 3rd party wallet or withdraw crypto interests to a private wallet.

I find this part of their TOS a bit worrying, not sure how to interpret this correctly:
 

8.1. We make no guarantee that you will be able to buy or sell an interest in a Supported Cryptocurrency or make a P2P Transfer at the time of your request. We will only reflect the purchase or sale of your interest in your Skrill Account if we have been able to fulfil the Order with the Cryptocurrency Exchange.

Why would they not be able to fulfil a user’s order? Problems with liquidity? I highly doubt it. Could they maybe use this part of their TOS as an excuse to limit certain orders at certain price ranges that might not be aligned with their best interests? Who knows?


You should know that Skrill reserves the right to suspend or ban a user from using its cryptocurrency service at any given time for many reasons. Why would their partner (cryptocurrency exchange) require Skrill to exclude a particular user? Could Skrill be using this as an excuse to restrict those they consider successful crypto traders? They would be making money on the transaction fees either way.  
 

10.3. We may at any time suspend or terminate your use of the Cryptocurrency Service without notice if:
 
10.3.1. we are required to take such action by the Cryptocurrency Exchange;

Suppose a user is temporarily suspended from using the crypto service. In that case, Skrill reserves the right to sell some or all the interests of that user. Customers might lose money this way because Skrill might sell off your interests at a time when the value of the purchased interests has dropped.  
 

10.6. Whilst your use of the Cryptocurrency Service is suspended, we may (using our reasonable discretion) sell off all or some of your interests by providing notice to you in certain circumstances,...

10.7. If we sell off your interests in Supported Cryptocurrencies, we will buy back the interest(s) at prevailing market rates. If the value of the Supported Cryptocurrency has weakened, this means that you may incur a loss relative to the amount you initially paid.

Pros:

•   P2P transactions between different Skrill customers are possible.
•   The service supports 35+ countries.
•   Automated buy and sell orders.
•   A Recurring Order feature.


Cons:

•   A custodial and centralized service.
•   Crypto interests can’t be used to purchase goods/services from registered merchants.
•   Isn’t available for customers from the USA.
•   Foreign exchange fees applied to Skrill accounts denominated in all currencies except the euro.
•   Transfer crypto assets/interests to 3rd party wallets outside of the Skrill network.
•   Buy and Sell orders might not be completed for various reasons.
•   A customer can be suspended and/or banned from using the cryptocurrency service.
•   Suspended users can have their cryptocurrency interests sold off at the current price and incur losses in those trades.



Sources of information:

1.   https://www.skrill.com/en/footer/terms-conditions/skrill-cryptocurrency-terms-of-use/
2.   https://www.paysafe.com/gb-en/paysafegroup/news/detail/skrill-wallet-users-can-now-instantly-buy-and-sell-cryptocurrencies/
3.   https://www.skrill.com/en/siteinformation/fees/#buy-and-sell-cryptocurrency
4.   https://www.skrill.com/en/siteinformation/fees/#Currency-conversion
5.   https://support.skrill.com/PAYMENTS/Crypto/1326804412/What-is-a-Recurring-Order-And-How-Do-I-Create-One.htm

[1715587966]

1715587966

[1715587966]

1715587966

[1715587966]

1715587966

[1715587966]

1715587966

[1715587966]

1715587966

[CryptocurencyKing]

It's a fine job you've done bring these informations to our notice on a much needed and used services. First with PayPal and now Skrill. Of a truth, most of us take these TOS so simple that we fail to go in-depth and search on ways that we can maximize the use of the available services. By making threads of it makes reading much easier.

Suppose a user is temporarily suspended from using the crypto service. In that case, Skrill reserves the right to sell some or all the interests of that user. Customers might lose money this way because Skrill might sell off your interests at a time when the value of the purchased interests has dropped.  

Once your purchase is completed, Skrill will hold the purchased interests on your behalf pooled together with the interests of all other Skrill users. That means you will never own the real assets or have access to the private keys protecting them. Only Skrill will.

Seeing terms like these makes my question myself on what's the point owing an interest when your not allowed to be in total control on how to use your interest. One of the points or privacy crypto enthusiast enjoy is the privilege of being your own bank and with Skrill in control of the interest fells more like that right is being faulted and it isn't cool.
Coupled with the fact that, should you be suspended as stated above, your interest could be transacted in ways that best suits Skrill. A mean, no one does business that isn't in their favour and with the way I see it, that doesn't favour the owner of the interest. I think that term is very much against users.

Some of the things you can’t do with the Skrill crypto interests:
- Upload or spend your crypto interests via Skrill Mastercards.

This is a much more needed service and it would do the company a thing of good to enable it to best serve there patronizers. Else, what's the point in owning the damn card anyway!

I find this part of their TOS a bit worrying, not sure how to interpret this correctly:
 

8.1. We make no guarantee that you will be able to buy or sell an interest in a Supported Cryptocurrency or make a P2P Transfer at the time of your request. We will only reflect the purchase or sale of your interest in your Skrill Account if we have been able to fulfil the Order with the Cryptocurrency Exchange.

Why would they not be able to fulfil a user’s order? Problems with liquidity? I highly doubt it. Could they maybe use this part of their TOS as an excuse to limit certain orders at certain price ranges that might not be aligned with their best interests? Who knows?

I think it's about the liquidity at this point. Supposing the network is way too congested, reflecting the transaction only prevents you from placing other ones while you a wait a confirmation on the other hand supposing it's a service within it's terms. I'm not sure but, this is what I could deduce from that.

[The Wasp]

Till now, I didn't even know that Skrill was offering something like that. Is that something new?
They probably did this in order not to lose the race with PayPal as their main competitor.

[mrob82]

This is going to get redundant with the amount of paypalesque type of platforms, but this is going to be a nightmare with all of the issues that all of these companies are going to bring to the crypto world.  Bottom line, I have told everyone that I know that uses these platforms to not even touch the crypto aspect of it unless they want headache.  I wonder if people are going to realize that they are not owning any of these coins at all, probably not.

[Bitcoin_Arena]

A couple of days ago someone made a complaint about Skrill disabling or blocking the crypto options in their crypto tab. I have been trying to locate the thread but can't see it, I think it was deleted. Bottom line is people should avoid such service (Neteller and skrill) when it comes to cryptocurrencies

Edit:

Found the thread - Neteller and Skrill dont support BTC anymore?

[Pmalek]

This is a much more needed service and it would do the company a thing of good to enable it to best serve there patronizers. Else, what's the point in owning the damn card anyway!

It's a card like any other prepaid card. It's main purpose is to spend fiat currencies just like with other cards. Maybe the option to spend crypto will be enabled sometimes in the future, but I doubt it.

Till now, I didn't even know that Skrill was offering something like that. Is that something new?
They probably did this in order not to lose the race with PayPal as their main competitor.

Not really. Skrill introduced its crypto service in summer 2018, prior to PayPal. PayPal did it much later, in October 2020. So it's the other way around. 

I have told everyone that I know that uses these platforms to not even touch the crypto aspect of it unless they want headache.

I wouldn't go near it myself. I would consider any other option before even thinking of purchasing interests in coins from money-hungry institutions like PayPal or Skrill. At least they call the thing they sell 'interests' and not real cryptocurrencies.   

I wonder if people are going to realize that they are not owning any of these coins at all, probably not.

I doubt it. The number of people who use or know bitcoin and crypto is still not that big. The number of people who understand it and know how it works is even smaller. Those who would use services like Skrill's have heard about this new fancy online money called bitcoin. They have been told they can make big money with it, and that is where their interest begins and ends.

Snip

I will take a look at that. I wonder what the user did and what Skrill's excuse is for restricting him from purchasing bitcoin.

[dkbit98]

I also heard some people complaining about issues with Skrill cryptocurrency service but I never tried it myself and I can't confirm.
I did visited Skrill Twitter account and I see they added new coin few days ago, and I don't see anything about them dropping Bitcoin.

[casperBGD]

Snip

I will take a look at that. I wonder what the user did and what Skrill's excuse is for restricting him from purchasing bitcoin.

you cannot use BTC or any crypto dashboard Skrill offerings with merchant account on Skrill, you have to have private account settings, that means if you have regular payments (especially monthly) to your Skrill account, they will mark it as merchant, and you will lose your privilege to buy crypto directly from Skrill

[Pmalek]

Snip

I don't remember seeing any such restrictions in their official cryptocurrency terms, is that really true? Do you have a source for this information that I could take a look at? It would be beneficial to know, and I could add it to the OP for everyone else to see and read through.

[casperBGD]

Snip

I don't remember seeing any such restrictions in their official cryptocurrency terms, is that really true? Do you have a source for this information that I could take a look at? It would be beneficial to know, and I could add it to the OP for everyone else to see and read through.

missed this one, yeah, if you think that is of any use, I can attach all e-mail correspondence with Skrill regarding this one, they actually closed my crypto dashboard due to change to merchant account, and took 0,43 ETH at the moment

had to go through really long e-mail correspondence (it was almost a month from the beginning to final e-mail) with them to take the money back, and change my account back to private in the process

edit: actually, it would take me a tone of time to attach all the correspondence, and I am still their user, so would skip that

[Pmalek]

Snip

What a pathetic excuse for a crypto service. I thought you read it somewhere, but you actually experienced it on your own. I read their entire TOS while making this thread and I can't remember seeing anything in there (otherwise I would have mentioned it here) where they restrict members who receive monthly service fees or merchant accounts from using their crypto interests service. Why would they even care and what difference does it make to them, who knows...

[stompix]

Why would they not be able to fulfil a user’s order? Problems with liquidity? I highly doubt it. Could they maybe use this part of their TOS as an excuse to limit certain orders at certain price ranges that might not be aligned with their best interests? Who knows?

I think it's about the liquidity at this point. Supposing the network is way too congested, reflecting the transaction only prevents you from placing other ones while you a wait a confirmation on the other hand supposing it's a service within it's terms. I'm not sure but, this is what I could deduce from that.

Or simply they don't have how to fulfill it, probably they are running a new improved version of the classical "no your keys, not your coins" upgraded to "everything if ours and we can take it when we want it".

On top of everything else that was mentioned I had a look at the so-called "Cryptocurrency Service - Risk Statement". I don't know who wrote this but probably deep inside he is one crypto hater

Unlike most currencies, which are backed by governments or other legal entities, or by commodities such as gold or silver,

Can you buy bolivars on skrill? 

The cryptocurrency market is highly susceptible to market manipulation and other misuse for illegal activities.
More generally, cryptocurrencies are susceptible to bubbles or loss of confidence (irrational or otherwise), which could collapse demand relative to supply.
Accordingly, a hack is likely to lead to substantial depletion of the Supported Cryptocurrency held on your behalf (see below). Whilst the Cryptocurrency Exchange may be willing to compensate users for any such loss, they are not obliged to do so.

Anyhow, I don't know why some people still keep on using skrill, from all the services available they are the worse, I've tried enough in my life and skrill probably is better only than Liberty Reserve, and that only because that one went down.
If you want to play with cryptos that you will never own try Revolut, at least the chances of getting not ever seeing your money again are 98, not 99%.

[Velkro]

Cons:

•   A custodial and centralized service.
•   Crypto interests can’t be used to purchase goods/services from registered merchants.
•   Isn’t available for customers from the USA.
•   Foreign exchange fees applied to Skrill accounts denominated in all currencies except the euro.
•   Transfer crypto assets/interests to 3rd party wallets outside of the Skrill network.
•   Buy and Sell orders might not be completed for various reasons.
•   A customer can be suspended and/or banned from using the cryptocurrency service.
•   Suspended users can have their cryptocurrency interests sold off at the current price and incur losses in those trades.

Great job, you really put an effort here to make that great summary.
Some are worrying, some less but overall if someone want to start using this service, priceless summary.
They should allow USA citizens or EUR because they in seconds here lost 60% customer base.

[Pmalek]

Bump

[Pmalek]

Update:
In February 2021, Skrill introduced a new feature that allows its users to withdraw bitcoin and ethereum from Skrill to the customer's private wallet. This option will first be available in the EU, and from their they plan to expand to the UK and other parts of the world.

Thanks Lucius for making me aware of this news!