CoinPayments Review: Crypto Payment Processor Guide
CoinPayments is a crypto payment processor and gateway that makes it easy for businesses to accept payments in over 1,300 cryptocurrencies.
They have developed simple payment technology such as website plugins, APIs and Point-of-Sale interfaces that allow vendors to accept a plethora of coins and tokens. This approach has seen them grow their market share globally as crypto adoption is has taken off.
However, is CoinPayments safe and are they worth it?
In this CoinPayments review, I will attempt to answer that. I will give you everything you need to know about this service including a step-by-step guide for you to start using them.
CoinPayments was begun in 2013 in Vancouver Canada and it offers payment processing for businesses. Business can use the service to accept Bitcoin and more than 1,340 other altcoins easily and with a small 0.5% fee. Plus the merchants have access to a host of easy to use POS interfaces, APIs and website plugins.
CoinPayments boasts nearly 2.5 million vendors using their service across 182 countries. It is clearly the most comprehensive merchant payment platform for Bitcoin and other cryptocurrencies.
They are extremely convenient for online merchants especially, thanks to the number of easy-to-use shopping cart plugins available for use with all the leading shopping cart solutions. There are literally dozens, including Wordpress plugins, WooCommerce, OpenCart, Magento, Shopify and more.
They even offer merchants the use of POS terminals to accept payments in person.
Those are just a few of the reasons that CoinPayments has become the most popular cryptocurrency payment processing service in the world.
In addition to the great integrations available for merchants, CoinPayments has a vast array of other features that have helped it become the most popular solution for merchants looking to accept cryptocurrency payments. Here are a few of those features:
CoinPayments also offers an online wallet that can be used to store the more than 1,340 supported coins. This is the wallet where the crypto that you earn will go.
Because it is an online hot wallet it is recommended to use it for large amounts or for long periods of time. You will want to move the coins into your own wallets for cold storage.
Through the simple CoinPayments’ interface merchants are able to accept in-person payments for their goods and services. You can even head on over to their Merchant page and use a demo version of it.
Example of the Point of Sale System
All you will need to do to accept payments through the site is to bookmark your POS checkout URL. You can then input the amount that the customer has to pay and you can select the coin in question. This will generate the address and the QR code.
GAP600 Instant Confirmations
There is no point using a payment gateway if you have to wait for 6 network confirmations before it is credited. Thankfully though, Coinpayments supports GAP600 instant confirmations.
Coinpayments has been partnered with GAP600 since June of 2017 and have been using the service ever since. GAP600 has developed technology that is able to instantly guarantee transactions against the risk of double spend.
Essentially, their internal risk engine can analyse the incoming transactions and perform live risk scoring on it. Since implementing the solution, over 85% of all transactions made on CoinPayments are able to complete instantly.
Dozens of Shopping Cart Plugins
We talked about these above, and CoinPayments offers shopping cart plugins for all the popular web shopping carts. You can see a list of all the supported shopping cart solutions here.
Some of the plugin integrations at CoinPayments
Including WordPress, PrestaShop, Drupal and Magento, Coinpayments has a plugin for nearly every CMS on the market. These are also really convenient as you only have to install the plugin without any knowledge of coding them up.
Automatic Coin Conversions
CoinPayments can automatically convert some coins to fiat currency or other coins, without any hassles, saving you both time and money. This is done through their ShapeShift integration.
ShapeShift is one of the most well known instant exchanges on the market. Given that they are non-custodial it means that your coins are not stored on their servers. They merely operate as a conversion service and they will send coins directly to your destination address.
Fiat Currency Settlement
Despite how much we would like a world that is dominated by crypto, most businesses still have to rely on fiat currency for their day-to-day expenses. Hence, CoinPayments has an effective fiat settlement system.
For those merchants who are located in the US and in the European Union, you can get seamless fiat integration where USD and EUR can be sent directly to your bank account.
This is a cold storage alternative to the standard hot wallet that we mentioned above. If you would prefer not to store your own coins and private keys online then you can make use of the CoinPayments Vault service.
Essentially, when you select this, your coins are stored in the cold storage vault and they are locked up for a certain period of time. Of course, nothing really beats holding your own keys but this could be a convenient alternative.
AirDrops can sometimes be a contentious issue on custodial services as exchanges and payment processors. There are many exchanges, for example, that will refuse to credit airdropped coins to users.
Thankfully though, CoinPayments will fully credit user's accounts with the airdropped coins. This means that you do not have to worry about the often-complicated process of claiming these coins in your offline wallet.
CoinPayments Mobile App
CoinPayment has developed both Android and iOS apps that can be used to access and manage your account, convert coins wherever you are, and accept in-person payments.
CoinPayments Mobile app in the iTunes Store
The app has received generally positive feedback on the Google Play Store with a total rating of 3.7. What is even more encouraging than the ratings though is the responsiveness of the developers. They get back to all users immediately and take the feedback constructively.
This is a unique feature which can greatly simplify the process of receiving payments. It allows a user to send / receive payments without having to copy any of the long form wallet addresses.
$PayByName on the other hand allows you to use a simple human readable address form within the CoinPayments ecosystem. For example, if the Coin Bureau wanted to receive Bitcoin, instead of using our long form Bitcoin address:
We could simply accept payment to $CoinBureau. This address would be pre-assigned, verified and applied to only us. This means that someone could easily remember it and send us crypto without having to store our long form address.
CoinPayments says they are the cheapest crypto-payment service in the world. Nearly all incoming payments and deposits are subject to a fee of only 0.5%. The ASAP/Nightly service forwards funds to an external address and is also subject to the usual coin transaction fee.
In addition to that, there are wallet fees for some services. Conversions carry the coin transaction fee and any partner fees. Withdrawals are subject to the coin transaction fee. And deposits to the wallet are free up to $15,000 equivalent value monthly, with amounts above that subject to the 0.5% fee.
The CoinPayments fees are actually quite impressive. For example, if we were to take a look at BitPay, their biggest competitor, they charge a 1% processing fee. It is is also worth noting that BitPay only accepts Bitcoin compared to the plethora of coins on offer at CoinPayments.
The CPS Coin
In July 2018 CoinPayments began airdropping CPS coins which are the utility token on the CoinPayments platform. There are a number of benefits that come from using the CPS coin:
- Payment Processing Fee Rebate: Any balance of CPS coin in your account will mean that you can earn a 50% rebate an all the fees that you pay to CoinPayments.
- Double Affiliate Commissions: If you refer users to CoinPayments then you will earn an affiliate commission. Usually, this is set at 25% of the fees earned by that affiliate. However, if you take payment in the CPS coin then you will earn double that amount.
- Coin Integration: If you work on a cryptocurrency project and would like to have your coin integrated into CoinPayments then you can pay the integration fee in CPS.
- $PayByName Purchases: When you use the CPS token you can make $PayByName purchases which streamlines the process for users.
Currently, the CPS coin is not listed on any exchange and can only be purchased through the CoinPayments platform. This is one of the reasons that the CoinPayments team is trying to increase adoption for it.
You would also be interested to know that the CPS coin was not built on top of Ethereum like most tokens, but was instead built on the Syscoin blockchain. So, like paying for ETH transactions with Gas, you will have to use a similar method when sending CPS on the Syscoin network.
CoinPayments Ripple Hack
CoinPayments suffered a significant loss of Ripple (XRP) from user’s hot wallets in June 2017. The loss was due to a bug in the CoinPayments hot wallet, which was discovered by a user who then used the exploit to pull XRP from other user wallets.
While the hack was unfortunate, it was good to see CoinPayments make good on all the XRP stolen from its users. In just 6 months time it reimbursed every user who had XRP stolen from a hot wallet. Of course, they also patched the bug that allowed the exploit in the first place.
Extract from the CoinPayments Disclosure of hack. Image Source
It is the only time in the 6 years that CoinPayments has been in business that they suffered any type of theft. Ultimately the bug was specific to the integration of Ripple technology.
According to CoinPayments at the time:
We have completed a complex back-end rebuild including multiple new safety measures and protocols to ensure this issue never occurs again.
CoinPayments Step-by-Step Guide
Now that you have a fair idea of what CoinPayments is and its main functionality, it helps to know exactly how to set up your CoinPayments account and wallet. The below is a handy guide that will show you the exact process as well as the best settings to receive the coins.
Step 1: Create a New Account
The first step to use CoinPayments is to register an account with them. You can create either a personal or enterprise level account.
Creating a CoinPayments Account
After filling in the form and clicking “Register” you’ll receive an email from CoinPayments. To complete the registration simply click the activation link in that email.
You’ll be directed to login and after entering your username and password you’ll receive a code sent to your email to complete the login process.
Verifying your Account Details
You will also be surprised to know that there are no KYC and identity verification requirements at CoinPayments. Unless you are going to use the ShapeShift coin exchange functionality then you can take crypto payments as intended - anonymously.
Step 2: Choose Payment Methods
Once logged in you can set up your Merchant Account or Wallet. Given that you want to start accepting cryptocurrencies, we will be setting up a merchant account.
Ready to start setting up your wallet / account
When you choose the Merchant Account the first step will be to select your payment methods. There are four options of how to select payments. These include:
- All supported Coins: You could accept all coins that CoinPayments supports. While this does give your customers choice, it does leave you with the risk of accepting less desirable coins
- Selected Coins: If you only really want to get particular coins from your customers then this is perhaps your best bet.
- Coins with Auto Convert: This option will auto-convert into particular coins that you choose. You will, however, have to use the ShapeShift exchange integration service.
- Fiat Settlement: With this option, you can accept coins but payment will be made in fiat to the bank or PayPal account of your choice.
Which payment method you accept really does depend on your businesses' individual requirements. CoinPayments suggests that you opt for the simplified select coins option.
Step 3. Configure Your Merchant Account
Once you have accepted the payment method that you would like to use then you can start to configure your wallet. Here you will choose the destination address for the coins as well as your conversion settings. You can also integrate your fiat settlement platforms here if this is something you plan to make use of.
Configuring Coin Acceptance Settings
Once that’s all set you’ll be taken to the integrations section, where you can set up shopping cart plugins, payment buttons, APIs, the POS system and more. You can also move over to the merchant tools section for a more comprehensive selection of customization options.
If you are stuck at any point in the process then you can always make use of their extensive FAQ section. However, if your query is more specific in nature and related to your account then you will have to contact their support desk. CoinPayments operates a ticket support system that which you can raise from within your account.
Step 4. Start Accepting Crypto
You are now ready to start taking cryptocurrencies!
If you are using CoinPayments on your site then you may want to place their logo in your footer. This will show your customers that you are able to accept crypto. Here is an example that you can use:
Showing customers you accept Crypto
You could also include some of the coins that you are willing to accept just below that to further reinforce the point to those who are not too familiar with CoinPayments.
With six years of serving merchants and nearly 2.5 million merchants registered to use their service, CoinPayments is undeniably safe and a legitimate payment processing service.
There are obviously complaints online regarding the unfortunate XRP thefts from 2017, but that’s nearly 2 years past and there’ve been no repeat incidents. In addition to that, CoinPayments was very quick to respond to the incident, patching the exploit, keeping users updated, and quickly refunding all stolen funds. They responded professionally to the incident and have taken steps to secure their platform and avoid any repeat incident.
While the incident was unfortunate it’s also important to understand the security risks inherent in cryptocurrencies, and that the technology remains in its infant stages.
The best way to avoid any such incident is to avoid using online hot wallets if at all possible. CoinPayments has a cold storage vault that can be used, or with their ASAP service payments are sent to an external address rather than to the CoinPayments online wallet.
Merchants who want to accept cryptocurrencies have an easy way to do so with the CoinPayments platform. Your business can be one of the first in your industry to adopt this world-shifting technology and to increase your customer base by doing business in cryptocurrency.
Featured Image via Fotolia
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.