Payment methods
When trading bitcoins for national fiat currencies, one issue that frequently comes up is the mismatch between the hardness (non-reversibility) of bitcoin, and the softness (reversibility) of many of the fiat-currency payment methods. This page lists a number of payment methods, hardness ratings, and more detailed info in the notes field.
Hardness goes from 0 (extremely soft) to 10 (completely non-reversible).
| Method | Currencies | Hardness | Notes |
|---|---|---|---|
| Liberty Reserve | EUR, USD | 10 | Very good match for trading bitcoin. However, it is difficult to get LR funded - it is only possible through third-party exchangers. |
| Webmoney | USD, RUB, BYR, EUR, XAU | 10 | Very good match for trading bitcoin. Requires funding by bank wire though, which may be expensive for small amounts. |
| PayPal - regular | Most world currencies | 0 | Extremely easy to charge back. Also, since trading bitcoin is against their ToS, good luck disputing the chargeback. Do not use. |
| Paypal - personal | Most world currencies | 1-5 | If funded via bank, requires person to dispute the ACH, which may be more arduous. If funded via credit card, requires person to dispute the CC charge, which is pretty easy. Since there's no way to tell what the funding source was... it's a gamble. Also, if paypal account is reported stolen, paypal will probably attempt to claw back the money. |
| Paypal - masspay | Most world currencies | 7 | Mass pay requires funding from paypal balance. Generally much harder to reverse, but not impossible. Probably your biggest worry here is an actual stolen account. |
| Dwolla | USD | 3? | Since Dwolla amounts are funded via ACH, Dwolla will reverse payments if the funds were the result of fraud. Additionally, Dwolla's Terms and Conditions now state that peyments received are subject to chargebacks as the result of their internal dispute resolution processK[1]. |
| Serve | USD | 0 | Extremely easy to charge back. |
| AlertPay | Many currencies | 1 | Because payment may be made using a credit card a charge back is easy. Doing so however will cause the account to be closed. |
| Moneybookers | 0 | Chargebacks are possible. Accounts have been terminated when this payment method was used for a Bitcoin trade. | |
| Neteller | |||
| Western Union Money Transfer | 9 | A money transfer can be stopped but once funds are withdrawn as cash there's little risk[2]. | |
| Money Order | 5 | A money order can be lost or stolen and there are procedures for reporting that. Losses could occur even weeks after the check has cleared[3]. | |
| MoneyPak | USD | 9 | MoneyPaks are irrevocable. There have been reports where the party attempting to redeem a MoneyPak number has been asked to provide a copy of the receipt used to purchase the MoneyPak. |
| Personal check | Any currency | 5 | At least in the USA, once a check clears, it is hard to claw back except when fraud is alleged. |
| Bank ACH | USD | 5 | Though not very easily, ACH can actually be clawed back if the transaction was the result of fraud. |
| Euro SEPA transfer | |||
| Cash in mail | Any currency | 10 | No chargebacks, obviously. Just check for counterfeit paper. |
| Cash at bank | Any currency | n/a | Some exchanges (e.g., Virtex and OTC traders accept cash deposited to an account at a bank. |
| Check at bank | Any currency | n/a | Some exchanges accept a check deposited to an account at a bank. |
| Credit card | Any currency | 0 | Dead easy to charge back. Do not use. |
| TransferWise | GBP to EUR | ||
| Intra-bank transfer | |||
| Popmoney ACH | USD | 5 | Since Popmoney transfers occur via ACH, Popmoney will reverse payments if the funds were the result of fraud. |
| ING Person2Person | USD | 5 | Since Person2Person transfers occur via ACH, ING will reverse payments if the funds were the result of fraud. |
| Pingit | UK | 5 | Barclays will reverse payments if the funds were the result of fraud. |
| Chase QuickPay | USD | 3 | Chase has reversed legitimate transactions as the result of anti-fraud measures[4] requiring the sender to be trusted to re-pay. The sender can also request a reversal after submitting an affidavit alleging that fraud occurred. |
| AliPay | CNY | n/a | Though reports of reversed AliPay payments can be found on the Internet, the operator of Bitcoinica asserts that AliPay transaction are "non-reversible"[5]. |
| Bitcoin | BTC | 10 | While the bitcoin network has no concept of a bitcoin transaction being reversed, there could be the possibility of an exchange or merchant refusing to accept a bitcoin for various reasons (e.g., funds were stolen). |
| Redeemable Code | USD, BTC | ? | These are generally bearer instruments so the "hardness" would seem to approach a 10 however each exchange that issues a redeemable code may have its own policy. As these are a fairly new tool, it is not known if any exchanges will refuse to honor a code of their own (e.g., customer claims that the code had been stolen). |