Some funds including those from BPAY deposits and Instant Buy purchases are held in the reserved balance for up to 14 days.

Funds in the reserved balance are unable to be sent to an external address or withdrawn to a bank account until the end of the reserve period. During this time, you're still able to able use these funds to buy or sell cryptocurrencies.

What are the exact timeframes?

BPAY deposits: Held in the reserved balance for up to 7 days from the date it was deposited.

Instant Buy purchases: Held in the reserved balance for up to 14 days from the purchase date.

All other deposit/purchase methods: Not subject to the reserved balance.

What are the restrictions?

Early withdrawal allowance

While reserved balances are necessary to reduce the risk of fraudulent payments, the obvious downside is delaying instant withdrawals for legitimate use cases. To assist with this, a portion of the funds contained within your reserved balance are able to be sent externally before the reserved balance period has ended. Please contact CoinJar Support to check your early withdrawal balance.

How reserved balances are calculated

The length of your reserved balance period - as well as the size of your early withdrawal allowance - is determined automatically depending on a number of security factors. In general, as you continue to grow your history of reliable bank transfers into CoinJar, your reserved balance period will decrease, and your early withdrawal allowance will increase - allowing you to access more of your funds as soon as they arrive at CoinJar. 

Chargeback requests

Raising a chargeback request for a bank transfer sent to CoinJar will have an adverse affect on your reserved balance. A chargeback request will greatly reduce your early withdrawal allowance and increase your reserved balance period length for future bank transfers into CoinJar.

How price fluctuation can affect reserved balances

Because your reserved balance controls the digital currency amount you can send from your CoinJar to an external address, price fluctuation can affect your ability to make new Payments.

An example, assuming the reserved balance won't reset for seven days:

If you make a $1,000 Australian dollar deposit into your CoinJar, your reserved balance will remain at $1,000 for the next seven days. This will temporarily prevent you from sending $1,000 worth of digital currencies to an external blockchain address. In the meantime, you might convert that amount into $1,000 worth of bitcoin. If the bitcoin price were to increase by 50% during the seven day period, you’d now hold $1,500 worth of bitcoin. You could send out the difference between the current bitcoin valuation, and the amount of your current reserved balance - in this case $500 worth of bitcoin.

The same can be said for a decrease in valuation. If the bitcoin price were to decline drastically during this seven day period, it could potentially prevent you from sending out a bitcoin amount that has already been stored in your CoinJar. 

Why are reserved balances important?

Reserved balances greatly reduce the ongoing risks of bank chargebacks and fraudulent payments passing through CoinJar. Without them, it would be possible for funds to be deposited, and then irreversibly sent onto the blockchain - well before being reported as a fraudulent payment by the bank account owner.

Along with the security benefits that come with reserved balances, they also allow CoinJar to provide larger daily deposit limits by default - allowing better flexibility when it comes to trading digital currencies.