Amazon launches its own currency called Amazon Coins

By Dave LeClair ยท 17 replies
May 13, 2013
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  1. Amazon has announced that, starting today, users can purchase apps, games and in-app items in the Amazon Appstore and on Kindle Fire using the company's own Amazon Coin currency. To get buyers up and running with the new payment option,...

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  2. SalaSSin

    SalaSSin TS Booster Posts: 149   +58

    So if I want something worth 50$, I buy 5000 coins for 45$, and use the coins? Count me in.
    Mallok likes this.
  3. Skidmarksdeluxe

    Skidmarksdeluxe TS Evangelist Posts: 8,647   +3,274

    If I used Amazon I may use their coins but seeing that I NEVER buy anything online... To me it's moot.
  4. Never buy anything online? Seriously?

    Do you live in the past or something :p

  5. dotVezz

    dotVezz TS Booster Posts: 112

    Too bad this is only for the App Store (or am I missing something?)
  6. Timonius

    Timonius TS Evangelist Posts: 647   +58

    Ugh. Another business launches their own 'currency'. Does anyone else find this just as bad as carrying a thousand rectangular pieces of plastic?
    SantistaUSA likes this.
  7. badicuady

    badicuady TS Rookie

    It would be nice if we could earn coins if we take surveys or something like this...
    SantistaUSA likes this.
  8. Fbarnett

    Fbarnett TS Booster Posts: 210   +30

    Let me see I use a Credit or debit card to buy something.
    Now I use the card to buy the coins to buy something?
    Just a extra step here just wonder how this benefits amazon
  9. treeski

    treeski TS Evangelist Posts: 990   +233

    I think typically the benefit to Amazon is that people buy X number coins for some product, but have a few left over coins after the purchase. Then to make use of the rest of the coins, the user has to buy more. I don't know if that's necessarily how it will work out in this case, though.
  10. Skidmarksdeluxe

    Skidmarksdeluxe TS Evangelist Posts: 8,647   +3,274

    What's that got to do with you?
  11. MilwaukeeMike

    MilwaukeeMike TS Evangelist Posts: 2,887   +1,223

    What's the point? If I had to guess (just a wild guess..) that there's a tax benefit to selling virtual currency. Is virtual currency exempt from sales tax laws? And I'm guessing you don't have to charge someone tax if they're paying for something in Amazon coins right?

    Or maybe it's as simple as Amazon knows they have a few million customers and if everyone uses the coins and has a a buck or two worth of them sitting in their account then Amazon gets to keep that extra little bit of money that people haven't spent yet. So if everyone buys coins and doesn't spend them all they're basically giving Amazon a 0% loan. Good thinking Amazon!
    Skidmarksdeluxe likes this.
  12. MilwaukeeMike

    MilwaukeeMike TS Evangelist Posts: 2,887   +1,223

    This is how it works at church festivals and state fairs etc too... but that's to save every vendor the hassle of making change and carrying money. There's also the added benefit of putting security around buying coins, but making spending them easy. Then if your child starts buying games on your tablet, they can't buy more than the coins you have.
  13. insect

    insect TS Evangelist Posts: 349   +132

    I wonder if this isn't a way for Amazon to not-charge sales tax now that the new laws have passed Congress. Does an exchange of currency incur a sales tax? Probably not. So now you can exchange your currency from U.S. Dollars (which can be taxed) to Amazon coins (which cannot be taxed) and then buy stuff. I save 10% on the cost of the coin plus don't pay taxes. Amazon can offer the 10% off because they probably estimated that to be the cost of processing the taxes (not to mention that these coins are not based on anything and are completely dependent on a persons faith that Amazon will not fail and take all their coins with them... just like the U.S. Dollar and Us. Gov.).

    Ah the loopholes of the world.... at least I think so, since I'm not a tax attorney.
  14. insect

    insect TS Evangelist Posts: 349   +132

    Damn it.. MM beat me to it above.
  15. SalaSSin

    SalaSSin TS Booster Posts: 149   +58

    Dammit, you're right. OK, nothing to see here, carry on.
  16. Tygerstrike

    Tygerstrike TS Enthusiast Posts: 827   +93

    Even the govt is not stupid. It is a loophole. The pachincco players in Japan have a similar setup. They play then turn in their "winnings" and get a token of some form. Since gambling is illegal there. They then go around to the back of the building and turn in the tokens for prizes or cash.
    So this is a WELL established method of skirting the legal system. However, these ppl in the govt make the laws that others are getting past. If it becomes to much of a issue. The govt will just close that loophole and Amazon will have to find ways around it again. Point to note: Amazon isnt paying its vendors in coins. Eventually this model fails due to improper handeling of RL money. PPl get tired of the extra step. Especially if something goes wrong with a purchase. You could wait up to 2 weeks for resolution.
  17. Ravik

    Ravik TS Rookie Posts: 44   +8

    This seems a bit too fishy to me, given the timing of its release and the fact that Amazon crossed over to support the recent bill (which it previuosly opposed). Don't know what (if any) tax ramifications exist for this--maybe an accountant or legal person can speak to this?

    @Techspot: Sounds like you have a lead for a follow-up story. :)
  18. It saves them the per-transaction fees on credit cards when people are incentivized to buy large-value coins (gift cards, essentially). Instead of getting nickel and dimed (and quartered) by the credit card processors on tons of little transactions, they get hit with far fewer and lesser fees.
  19. Xclusiveitalian

    Xclusiveitalian TS Evangelist Posts: 714   +75

    It seems like a good deal only problem I find is, what's to stop them from saying your now 15,000 coins you paid $100 bucks for are now only worth $20.."deal with it"

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