xCoins Review – Is it Legit?
By: Ofir Beigel | Last updated: 1/21/21
xCoins.io (not to be confused with Xcoins.com) is a Bitcoin lending service that allows you to borrow or lend Bitcoins. In this review I’ll cover how the service works, its fees and my overall impression of it.
xCoins Review Summary
xCoins.io allows you to borrow or lend Bitcoins via PayPal, bank transfer, or a credit card. The site charges high fees and is sort of a workaround for the limited options available for buying Bitcoins with PayPal.
The company has been around since 2016, and while their service seems far from perfect they seem to be legit.
That’s xCoins in a nutshell. If you want a more detailed review keep on reading, here’s what I’ll cover:
- xCoins Overview
- xCoins Services
- xCoins Fees
- Supported Payment Methods
- Support and Online Reviews
There’s not a lot of information online about the company, aside from some sponsored press releases and articles, which have been removed by publications like Coindesk and Huffington Post.
Instead of selling you Bitcoins – they are loaning you Bitcoins (to an extent). Whether this is actually a loan or a sale is somewhat ambiguous and can be left for interpretation. Here’s how it works:
The buyer states how many Bitcoins he’d like to receive. After a short ID verification process, he is requested to deposit the USD equivalent of the borrowed amount + credit card / Paypal processing fees + a fixed amount that acts as the interest rate on the loan.
In fact, there is no ongoing interest on the loan since the amount is a one time payment. In most cases, these fees add up to around 20%.
The site’s FAQ states you can repay the loan at any time and get back your USD deposit minus the fees. However, you need to keep in mind two things:
- “all loan amounts are denominated in US dollars. You will need to return the amount of bitcoin equivalent to the amount you received in US dollars.” – This means that if you borrowed $1,000 when Bitcoin was $10,000 you got 0.1BTC (excluding fees for the sake of example). Now let’s say Bitcoin is at $20,000 – this means you will need to give back only 0.05BTC.
- “Please contact the lender directly to arrange paying the loan back.” – So basically you will need to trust someone whom you don’t know to respect this agreement and actually give you a refund.
You can also lend Bitcoins on xCoins. This is done by deciding how much you’re willing to lend in USD and deposit that amount into your xCoins account.
The system will then automatically match you with buyers (i.e. borrowers) and they will deposit money directly into your PayPal account.
I have not tried this method personally since I don’t want to get in trouble with PayPal in case a buyer files a dispute. However, several users online have reported that they have been generating nice returns through this method.
The site claims to have competitive fees since lenders compete against each other, thus giving you the best possible interest rate.
When I signed up as a lender I was not able to set my interest rate and it was fixed at 15%, so I’m assuming that’s the lowest possible rate. This is way higher than what I will get on almost any other Bitcoin exchange.
More recently browsing as a buyer, I was offered interest rates of 10% (which comes in addition to a 3.5% origination fee and 2.9% PayPal processing fee).
xCoins supports the following payment methods:
- Debit and credit cards
- Bank account (ACH)
- PayPal Credit
- PayPal Balance
For support, you can email xCoins at [email protected]. Additionally, there’s a company phone number (+1-310-589-4556) and Physical Address (1541 Ocean Ave., Suite 200, Santa Monica, CA, 90401).
For some reason, xCoins’ page on BitTrust does not exist anymore. However, I was able to find a cached copy of it and dig through additional user reviews.
One of the most detailed reviews had the following statement:
- Easy sign up
- Quick access to buy bitcoin with CC with PayPal
- Any amount under $20, you would have no issues
- Any amount over $20, you can expect errors where you are charged but the buyer does not send the bitcoin, so you have to notify Xcoins support and PayPal.
- The refund can take about a week or longer
- This has happened numerous times with purchases over $20.
- If you keep notifying their support that you have purchased bitcoin but have not received it from the lender then you can expect to be banned from buying bitcoin
- They will eventually disable your ability to buy bitcoin even if you do not dispute the charges
- Their support staff is not 24/7 or even business hours. If you submit an email to their support expect to wait at least 2 days at the least or longer.
- If the lender does not release the coins that you purchase you will still be charged, requiring you to contact both PayPal and their support.
Of course, there are other good and bad reviews which you can read for yourself but I think this one was the most comprehensive one.
After reading through dozens of reviews I can say that the recurring theme is that xCoins works, however the process is risky for large amounts, their support takes 2 days or more to respond and the fees are extremely high.
xCoins.io seems to be legit, however, it’s not necessarily the best choice for conducting business.
As a buyer (borrowers) – xCoins doesn’t seem stable enough at the moment to use for large purchases. Also, it seems that the fees will be extremely high compared to other cryptocurrency exchanges.
However, if the only way you can acquire Bitcoins is through PayPal and you’re willing to pay the price this might be a valid alternative to LocalBitcoins.
As a seller (lender) – Even though the ROI may be high I don’t want to risk being flagged by PayPal, so at the moment I can’t recommend this to anyone else as well.
If you don’t care if PayPal shuts down your account feel free to try your luck and I’d even appreciate if you can share your experience in the comment section below.