Bitcoin Buyers Can Now Pay with American Express on Abra
Each transaction comes with a 4% fee, which mostly covers Abra’s payment processing fees. Bill Barhydt, founder and CEO of the startup, said Abra will not earn any revenue from processing the transactions. Their money comes from exchange rates between Bitcoin and U.S. dollars.
American Express is an investor for Abra, participating in a $12 million Series A funding round in 2015. Over the last few months, Abra had to expose the inner workings of their app to American Express in order to integrate AmEx cards into their payment network.
There are some issues that may hinder mass adoption for this new service. Barhydt said, “There are some potentially unsavory folks in our universe. And we want to make sure we’re servicing the people whose intentions are good, and not the other folks.” To prevent those “unsavory” purchases, Abra will require people to buy Bitcoin after they have received their physical AmEx cards in the mail. They cannot sign up for a card and use the temporary card number to make purchases.
People who do not have an American Express credit card will still be able to buy Bitcoin with American Express. To do that, they can purchase a reloadable Bluebird card at Walmart and deposit funds onto the card. After registering their card with American Express, they will receive a physical card with their name on it. This can be used on the Abra app.