OneBit, a bitcoin wallet app that enables its users to pay with bitcoin at any credit card accepting store, has entered the alpha stage of development. OneBit announced that users are testing the application worldwide, and that it will go into closed beta very soon.
OneBit began as an NFC payment tool for MasterCard’s PayPass, which would have been used to pay with bitcoin at any MasterCard accepting stores. The application was developed at a Mastercard Hackathon by entrepreneur and OneBit CEO Toby Hoenisch, who received positive feedback from the credit card processor. Hoenisch said:
“I have been fascinated by Bitcoin for the last three years, but never quite found the right idea to form a company around until now. [...] We managed to get MasterCard and DBS bank interested in OneBit and with their help, I am confident that we can build OneBit without getting burned like Charlie Shrem did.”
Mastercard helped OneBit secure a partnership with a card issuer and to raise funding rounds for the development of its application.
OneBit made clear, however, that they haven’t partnered with Mastercard. Hoenisch said:
“To be clear: We don't have [an] official partnership with Visa or Mastercard. But we also don't need one. The risk would be that they force all of their thousands of issuing banks to stop doing business with bitcoin companies. The issuing banks are quite independent, so I don't see this [happening].”
To raise funding for its application and worldwide launching of their app, the OneBit team joined the Startupbootcamp FinTech accelerator in Singapore in April.
On July 23, OneBit launched a trial video of an alpha user paying for coffee at Starbucks with OneBit wallet. In the video, the user requests an NFC payment option. Then he opens the OneBit app, pays and instantly sees a change in the balance of the app. Unlike credit cards, OneBit app is prepaid, similar to all bitcoin wallets. Therefore, users will be able to check if their OneBit wallet has sufficient funds to make a purchase.
Hoenisch further explained on Reddit that the OneBit app could be described as both a prepaid MasterCard and a Visa debit. Therefore, “If you don't have enough funds you can't pay. The app will catch most of this, but if you manage to get the transaction started then the terminal will display: transaction declined.”