When I first got interested seriously in Bitcoin, it was pretty hard to get. Many people were buying their bitcoins by sending money orders to addresses in Albania or Russia and hoping, based on the reputation the seller might have on Reddit or BitcoinTalk that the bitcoins would actually arrive in their wallets.
One of the signs of the maturing Bitcoin market is that it is getting easier and easier to buy, sell, and use them. Trucoin is one company that is doing its best to make the onramp to Bitcoin as smooth as possible. They have just announced that they will be expanding their operations to more than 24 states.
I got in touch with Brent James of Trucoin to discuss with him some questions I had about companies selling bitcoins in the American market.
Trucoin is launching in 24 states and DC. We keep hearing about the difficulties of meeting legal requirements in the States. How has it been getting approval to operate in those states and what are your plans for the final 26?
Compliance has been something that we have known would be important from the beginning. It presents a plethora of challenges that are not to be taken lightly. Each piece of compliance from the reporting requirements down to the specific disclosures require careful attention to detail. There is a lot of overlap state to state, but there are states that have special requirements. All of it is a team effort and we have worked hard meet all of our obligations while still maintaining a very smooth customer experience.
You folks let people buy Bitcoin with credit cards. Ever since I’ve been involved with Bitcoin I’ve heard about the risks of selling with any system that allows chargebacks. Have you folks run into any problems with that? What do you do to mitigate the risks?
I am glad you asked that because that is something we have taken great pride in. Fraud is a multi-billion dollar a year problem online, not just in the bitcoin space. Our proprietary system, built internally based on a lot of research and experience, is something that we were able to prove out during our pilot program. It’s enabled us to accomplish one of our first goals in a long range plan, get a substantial amount of bitcoin in people’s hands easily and quickly. Again, some of the challenges here is the experience each person has. There is a careful balance between preventing fraud and providing ease of use. We have been happy with what we’ve been able to do thus far.
You folks are in direct competition with Coinbase and Circle. What advantage do you bring over them?
While some will draw comparisons, especially as it relates to deal points like accepting debit or credit card payments for bitcoin, we do feel that we have a very unique value proposition for consumers. With our first phase of our business plan, the fastest way to buy bitcoin allows people to purchase as much in a day as they could in a week with other services. In addition to the highest purchasing power using a Visa or MasterCard, you won’t find any hidden fees popping up later on a credit card statement. Obviously the ability to create an account and take delivery of bitcoin in a couple of minutes is also a big advantage. Beyond that, we take pride in the ease of use and our support options. We are available by phone, chat, email and even through our subreddit /r/trucoin.
Now, I’m a big proponent of the idea that Bitcoin’s price doesn’t matter in the short-term. I feel it will act more like a commodity until it hits a tipping points, at which time its currency feature will start to be more important. Nevertheless, what do you think are the real drivers of Bitcoin’s price?
It’s hard to say at this point. As this market matures, we begin to see the events already built in to the price. That’s not to say we don’t have a long road ahead, but by lowering the learning curve on the technology, Trucoin aims to play a large role in introducing more folks from the mainstream to the benefits of owning and using bitcoin. It’s come a long way in a short amount of time, and we are very excited about what the future holds for our space.
We’ve just heard that the SEC, IRS and other alphabet agencies have been sending out letters to Bitcoin businesses making it seem like they’re getting ready to take some action. Are you concerned about this and what actions are you taking to protect yourselves?
As I mentioned earlier here, compliance has been something that we knew would be important from day one. If you look back to the first iterations of ‘virtual’ or digital currencies, you will see that ignoring the legal aspect is not something that bodes well for companies that aim to take a long-term approach. Doing business in the financial space requires businesses to operate within the legal framework. The measures we take are always related to operating in a fully compliant manner in each state we conduct business in. This will continue to in every jurisdiction within our service footprint.