Digital retailer Amazon has launched its brand new online currency – to US customers only.
The online retail giant is not quite printing its own money – one Amazon Coin equals one cent, or less than one penny – but customers can now use the ‘currency’ to buy apps, games and in-app items from the Amazon Appstore.
To mark the launch, all Kindle Fire owners in America were given 500 coins (around $5 worth). Amazon has not yet confirmed when the scheme will be launched outside of the US, or if it will be available to non-Kindle users.
On Monday, Mike George, vice president of apps and games at Amazon said: “Today we are giving Kindle Fire owners $5 worth of Coins to spend on new apps and games, or to purchase in-app items, such as recipes in iCookbook, song collections in SongPop or mighty falcon bundles in Angry Birds Star Wars. And with discounts of up to 10% when you buy coins, this is a great way for customers to save money when they buy apps, games and in-app items.
“We will continue to add more ways to earn and spend coins on a wider range of content and activities – today is day one for coins.”
Some have questioned the usefulness of the move, as tax is still payable on items purchased with the new coins. But officials at Amazon have described the currency as “an easy way to purchase apps and in-app items” and well as a tool to drive traffic on their site.
In a number of fan reviews already posted online, those in favour of the coins have noted its use when trying to budget online purchases.
At the other end of the scale, the coins have been described as “nonsense”, a “gimmick” and a “waste of time”.
Amazon Coins can be bought in batches of 1000, 2500, 5000 and 10,000. As you buy more, the discount gets bigger – Amazon fans in the US can expect to pay $90 for 10,000 coins. These customers will also get a 10% discount on items bought.
Amazon isn’t the first company to introduce its own currency; Facebook, Microsoft Xbox and Windows Live customers have all launched similar points systems to pay for social media games, upgrades and bonus levels.
Another online currency that has been in the news recently is Bitcoin, which can be transferred without the use of a bank or institution. Although initial interest came from mostly tech-minded people with distrust in regulated banking institutions, it has grown in certain areas since.
Like other currencies it is used to buy goods and services. Companies selling anything from software to pizza are accepting it as payment. That said, a lot of its use is expected to exist on the black market, thanks in no small part to its relative anonymity.
Although cited by many as a currency, it is perhaps simpler to think on one Bitcoin as an online token.
Bitcoin is often referred to as a new kind of currency which have value because enough people believe they do.
Each of the 11 million Bitcoins currently in existence is represented by a unique registration number, created through a process called mining – a computer solving a difficult mathematical problem with a 64-digit solution. Each problem solved rewards the computer’s owner with 25 Bitcoins. The difficulty of the puzzles is adjusted to ensure a steady stream of about 3,600 new Bitcoins a day.