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Revolut Brings Bitcoin Without Private Keys to 10m+ Users

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USD 5.5bn fintech Revolut has decided to open crypto trading feature to their “standard” customers earlier than planned, thus helping crypto adoption and securing another revenue stream during the global financial and economic turmoil, triggered by the COVID-19 pandemic.

Source: Adobe/mino21

The crypto trading feature is not new for Revolut, but it was previously available only for its Premium and Metal customers.

The company, that employs 2,000 people, claims it has more than 10 million customers, mostly in Europe. Revolut does not disclose how many Premium and Metal users they have, but starting this May they’ll enjoy the crypto trading feature for a smaller fee than Standard users – they’ll pay 67% more.

Though it was planned for later in the year, Revolut reacted now to the ongoing pandemic, to the global economic crisis, and a number of potentially controversial tools many governments decided on using to try to mitigate the effects – including the quantitative easing program, which prompted hyperinflation fears. The company said in a letter to users that it decided to enable regular clients trading in crypto as well, thus giving them “the opportunity to explore different ways of diversifying, including through crypto.”

Revolut supports five cryptoassets: Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Litecoin (LTC), and XRP. Clients can use any fiat currency Revolut supports to buy crypto, and they can change back into fiat, all through the Exchange section within the app.

Revolut rate is derived from the partner crypto exchange, in this case Bitstamp, plus a 1.5% markup, to account for volatility, they write, adding that there are no additional fees for using the service. But the letter adds that the flat fee for Standard users will increase to 2.5% in May.

However, the company does not allow its users to transfer cryptoassets outside of the Revolut platform e.g. to an external wallet, as it “holds cryptocurrencies on behalf of those wishing to gain exposure.” According to the company, it “securely holds the private keys of all users in a pooled cryptocurrency wallet.”

This is also not a new grievance as many have been expressing it online for a couple of years now, claiming that those buying crypto through Revolut don’t have any crypto as they don’t have an address or a key, others saying that Revolut has no proof that they’re actually buying or holding crypto on a user’s behalf, and some even claimed that they lost thousands of dollars once Revolut decided to suspend their accounts.

Finally, Standard users will also gain access to Revolut’s gold feature later this month, with a flat fee of 1.50% per trade, while Premium and Metal users keep their much lower flat fee of 0.25% per trade.

In February, the company announced it raised USD 500 million in a Series D round, valuing the company at USD 5.5 billion. It raised USD 836 million in total. Revolut claims that the total number of users has grown by 169% in 2019, while daily active customers grew by 380% last year.