Wirex or Bitwala: Which crypto-friendly bank account is better?
An honest review of the emerging financial services that provide a bank account with integrated cryptocurrency trading and a debit card
Recently, I was very curious in finding some platform that will essentially work, like a banking service which includes cryptocurrencies, and which will allow users to easily buy, convert and spend crypto (read my previous post). As you might guess, I am a crypto enthusiast who believes in the crypto future and hopes that it will replace the traditional banking system one day.
After spending hours searching and reading reviews about various platforms, I selected two financial providers for further investigations — Bitwala and Wirex.
Bitwala
Overview
Bitwala is a Berlin-based company, which was founded in 2015. I instantly got a good feeling about the company — not only it has a very simple, intuitive website and transparent structure but it is also partnered with a traditional bank — Solaris Bank. Moreover, the project is co-funded by the Horizon 2020 EU program. For me, more credibility to Bitwala was added when I saw a story of an employee of a Big Four who has recently joined the start-up, as it is something I can relate to (I also work for the same Big Four firm).
If you decide to open an account with Bitwala, you will get:
- a fully functional German bank account with an IBAN;
- a possibility to trade Bitcoin almost instantly;
- a debit card which will be tied to your euro bank account powered by Solaris Bank;
- a separate BTC wallet, to which you will remain access to even if Bitwala goes down — you own BTC in your wallet! Also, it implies that the only fee you pay when sending BTC is the network fee.
Opening Account
The registration is relatively easy and just the standard information is required from you at this point. However, once you confirm your email address you must pass the verification process, which is done through the external provider IDnow (you have to download an app).
The verification itself is done live using the front camera of your phone, so be prepared to have all the necessary documents ready. My verification was going well, until I was asked to prove my address and, due to the German law, it possible to prove one’s address only by showing some type of a utility bill or a bank account statement. Moreover, the POA document must show clearly an issue date, as it cannot be more than 3 months old.
I had some issues proving my adress but Bitwala’s support team was very helpfull and fast in their replies (usually within 2–3 hours) and, in the end, I was able to find an appropriate POA and finish the verification process.
Next step was setting up a Bitcoin wallet. As I mentioned earlier, the wallet is independent of Bitwala and due to that (as with any crypto wallet nowadays) you have to prepare to remember 12 secret words for you to be able to regain accesses to it at any time.
That’s it — now you are all set and can order your Bitwala debit card!
Debit Card
The debit card came within three business days after I ordered it. It came with nice packaging and you can tell Bitwala worked on the design. I tested the card and it worked everywhere — paying online, at the store and ATM withdraw.
Fees
Bitwala has a very transparent fee structure — the only fee that is charged directly by Bitwala is when you trade crypto and it is 1% in either sell or buy option. Also, if you lose your card and want to reorder it, it will cost you EUR 9.50.
When sending money in or out of your bank account powered by Solaris using SEPA transfer (it is actually the only option to move fiat money), you might have to pay a fee, but this fee is independent of Bitwala and should be checked with your local bank, as Bitwala does not charge for SEPA transfers. For instance, Raiffeisenbank in the Czech Republic charges approximately EUR 7 on any SEPA transfer disregarding the amount.
Using Bitwala bedit card
Pay attention to the bank fees when you are not paying in EUR with your Bitwala debit card. For instance, the Czech Republic has not changed its currency to EUR yet, so you have to account for the bank fees when paying in CZK. Luckily, when you are paying at the store, there is an option either to charge you card in EUR straight or in CZK using the bank conversion rate (possible to select on the payment terminal).
Even though paying in the local currency may seem more beneficial, it is tricky, because when you choose a local currency option, the terminal just shows you the flat rate at which it will exchange EUR to CZK — not the price itself.
I tested both options and it turns out that selecting your local currency when paying results in the 1.5% — 2% additional fee. When I selected EUR option, there was no mark-up at all, and the EUR amount taken from my Bitwala bank account reflected an accurate exchange rate on that day.
As to ATM withdrawals, it largely depends on the bank itself. Always select “withdraw without conversation” and you will get a corresponding amount in the local currency with no extra charges. If you select the option to withdraw money with the “guarantee” bank conversion rate, in most cases this rate will be way higher than the current one and you will pay more.
Buying & Selling Bitcoin
The price for bitcoins is quite reasonable on the platform, as well, as it is only slightly higher than on the major exchanges. At the time of writing on Bitwala, you could have bought 1 BTC for EUR 9,088 while its price on CMC was EUR 9,060 (less than 0.5 % difference).
One disadvantage is that inorder to buy bitcoin, you have top up your account with euros using SEPA transfer, which will take approximately one business day. It is not possible to buy BTC using credit/debit card.
Conclusion
Overall, I think Bitwala is a great service and I use it my everyday life. It stands out among the other similar services, as it can balance the traditional banking with emerging blockchain technology. Bitwala simply got it all covered — partnering with a traditional bank, EU support and very competitive fee.
Wirex
Wirex is another service that allows users to instantly convert crypto into fiat, as well to have an account tied to a debit card.
Since Bitwala and Wirex are similar and quite honestly Bitwala seems like a better service overall, in this section I will outline the main distinctions between those two.
First of all, Wirex is a UK-based project, which raises some ambiguity due to Brexit — the service may simply not be able to serve EU clients depending on the Brexit outcome.
The first impression of the service is weaker than it was with Bitwala. The support took around 10 days to answer my request and the debit card that I received was wrapped up in cheap cardboard which I had no intention to keep (I keep the cool Bitwala’s UFO craft :)).
Wirex also has way more fees — for example, the card account maintenance fee is $1.5 per month. Also, the fee structure is not as transparent, as with Bitwala. For instance, the “crypto exchange services” fee is not clearly defined — it says, “OTC rates + commission”. When I bought some BTC, the mark-up was roughly 3.5% (with commission), which is roughly 2% higher than on Bitwala.
Also, Wirex does not provide a separate crypto wallet, as Bitwala does. So, when you transfer crypto to external wallets, the services charges commission.
For me this was the biggest disadvantage due to security reasons and as I tend to mover crypto frequently and in relatively small amounts.
Another big disadvantage is that Wirex issues a Visa debit card. Visa is an American payment provider and because of that, it charges additional conversion fees when you pay in the other currency than your card’s one. Due to that, my card was always charged slightly higher when I paid in CZK or used an ATM (roughly 3% markup) — even if I did not choose bank’s “guarantee” conversion.
However, Wirex still has some interesting features, which cannot be found at Bitwala:
- Wirex supports way more traditional currencies: AUD, CAD, EUR, CHF, CZK, GBP, HKD, JPY, MXN, SGD, USD;
- Wirex supports way more cryptocurrencies: BTC, LTC, XRP, ETH, WAVES, WLO, DAI, NANO, XLM, WXT;
- Instant conversion (Bitwala takes up to an hour to credit EUR to your account when you sell BTC);
- It is possible to buy crypto using credit/debit card;
- Fast verification — I only had to upload two documents to confirm my identity (took 2 hours);
- Wirex has its utility token WXT;
- The service pays out Cryptoback when you pay with Wirex card at the store and the reward can be increased depending on how much WXT you hold;
- It is possible to order EUR, USD or GBP debit card.
Even though Bitwala was more suitable for me, it does not have to be the case for everyone. Wirex’s selection of fiat and cryptocurrencies may be a decisive factor for many, as well as the service’s higher fees can be offset by the Cryptoback program.
It is important to note that Wirex positions itself, as more of a financial service; therefore, trying to differentiate its business model offering more options. On the other hand, Bitwala aims to be more of a modern bank account with transparent, reliable and very high-to-compete basic services.
In the end, when choosing between both services, you can choose both — just take the best of each service and utilize them in synchrony.
