NOTE: At the request of Amazon.com AmazonBitcoins has shut down. I’ll keep this post up as a reference to how the service worked when it was up and running.
You can pay for your Amazon order with MasterCard, Visa, and now…Bitcoin! To be clear Amazon has made no announcement that they’ll be directly accepting Bitcoin. Rather, two engineers out of San Francisco have put together a service that allows you to purchase Amazon gift cards with Bitcoin. While online retailers such as Bitcoinin and Bitcoin Store have done a lot to open up online retail to Bitcoin, Amazon opens up a whole different world. I decided to go ahead and test the service recently. Here’s my experience.
How It Works
Amazon Bitcoins breaks the process down into three steps. First you need to sign up by hitting the get started button. You’ll need to provide your email address and a password. Make sure to use your actual email address as this is where your Bitcoin will be sent. Once you’ve signed up the get started button will be replaced by your unique Bitcoin address.
Next you’ll need to send the amount of Bitcoins you’d like translated into Amazon gift cards to the unique Bitcoin address. This can be any amount of Bitcoin greater than $1 (USD) and does not need to be in $25 increments. Once you’ve sent the Bitcoins to the address you’ll receive an email stating that your payment was received.
Next you wait for your Bitcoin transaction to be processed. Once the transaction is processed you receive an email that lists the price paid in Bitcoin, the value of the gift card in US Dollars, and the actual gift code.
After signing up I went ahead and sent 0.725 BTC to the specified address. A few seconds later I received an email stating that I’d purchased $24.98 worth of Amazon gift cards and that they’d be sent to me once the transaction was processed. It took longer than usual for a block to pick up my transaction which delayed the gift card a bit. In total it took an hour and forty-five minutes from the time of purchase to receive my gift card (Pro Tip: Include transaction fees in your transaction for speedier processing). Normally transactions confirm in just under an hour.
Using the gift code is about as easy as it gets. I decided to pick up this steampunk USB thumb drive to back up my wallets. Once I’d entered the gift code an even $25 was deducted from my purchase which then processed smoothly.
Fees And Rates
The service does include a mark up on its purchases so you spend slightly more in Bitcoin than you receive in gift card value. The markup on my purchase was somewhere between 5-7% (The price of Bitcoin was moving at the time). More traditional methods, say changing your Bitcoin to US dollars and then making a purchase would also include transaction fees and likely take longer. With Amazon Bitcoins you gain speed and convenience at the cost of a small markup.
What if Amazon were to directly accept Bitcoin? With a market cap of over $400 million (USD) Bitcoin is certainly growing. However, the currency is still small if you consider its size relative to say the trillion plus US dollars in circulation. While the time will likely come when Amazon adopts Bitcoin as a payment option, we’re just not there yet. In the meantime you have the same products available to you via one of the most fluid and simple Bitcoin services I’ve used thus far. Amazon Bitcoins bridges the gap between the current state of Bitcoin and its bright future.
If you have a Bitcoin related product or service you’d like reviewed shoot us an email at CryptoJunky at zoho dot com.