So everyone knows by now that STEEM won the Netcoins listing contest. If you don’t know about Netcoins, this post includes some info on the company.
I came across Netcoins by accident back in May and actually had some email conversation with them at the time, when they only offered bitcoin (transcript below). I also noticed that one of their locations is a short walk from my house, so I figured I would try it out. But first my email conversation, which includes a few nuggets:
What does the customer receive by email?
What kind of wallet is set up for them? On what platform? How do they get access? It seems to me that: Netcoins must hold the private key, so this could only be a very temporary solution, until the customer moves it to another wallet; and
There is significant risk to the customer in that their BTC would only be as safe as their email is secure. Can you convince me otherwise?
When a customer purchase BTC with Netcoins the BTC are sent via a Blockchain wallet that is auto generated for them.
Once received, we encourage customers to change the password to the Blockchain wallet or move the BTC to a wallet of their choice.
Thanks for the quick response. However, I was hoping for some more detail. Could you confirm that a customer would receive an email with the following:
Transaction confirmation ($ for BTC equivalent)
Transaction hash, showing transfer to the new wallet?
Public address for their new wallet
Link to said wallet (is this Blockchain.com?)
Password with advice to change it
Once a customer complete a purchase with Netcoins, they will receive the following emails:
Email from Blockchain for email verification
Purchase summary email from Netcoins with the purchase summary, wallet info and warning advisory to change their password or transfer to their preferred wallet once log in.
Again, I would be concerned about the security when all of this information is being sent by email, which could easily be hacked.
Are there any other measures in place to increase security?
We are constantly working to improve our security and definitely appreciate your feedback!
On a completely different tack, I happen to live a two minute walk from one of your locations, so I am interested in your overall fee structure. So far, I have deposited to online exchanges by direct electronic bank transfers, and I wonder how competitive your fees are. What is your total markup, considering both the reseller’s commission and your own?
In terms of our fees, our reseller fees are generally at 7.5% above Bitstamp
Finally, if the customer provides an existing wallet address, what do they receive in their email? Transaction confirmation and hash?
We currently don't support sending the BTC to customer's wallet directly.
Customers can easily transfer it out from the Blockchain wallet to their own wallet once the purchase is complete.
Okay, so the fees are pretty high, but there are benefits in terms of ease of access. As noted above, I have concerns about security.
Having said that, I headed over to the retail location tonight. It is inside this vape shop:
It turns out STEEM is already available! Here is the full roster of available coins:
You select a coin, enter the $ amount you want to buy, and add name and email. They email you a verification code, which you enter in their system.
I started out by trying STEEM, and it turns out you can enter an existing wallet address for everything but BTC. This is a huge security improvement in my view. I wasn’t expecting STEEM to be available so I didn’t have an address handy. Instead I picked up some ETH.
I entered the wallet address and got an email confirmation.
Soon enough, I saw my transaction confirmed.
And there you have it. Piece of cake, ETH directly to my Ledger nano s. Still expensive though. Let me know your thoughts.