Table of Contents
- Crypto Cards: Credit Cards that allow cryptocurrency purchases
- What are Crypto Credit Cards?
- How do Crypto Credit Cards Work?
- Advantages of Owning Crypto Cards
- Best Crypto Credit Cards
- Things to Know Before Using a Crypto Credit Card
- Closing Thoughts
You are familiar with regular bank credit and debit cards. They are convenient to carry and use. You can only use fiat currency (USD, CAD) for shopping with these cards. But you might or might not have heard of it before; there are special types of credit cards through which you can spend both fiat and cryptocurrencies, and cryptocurrency in particular. Well, if you don’t know, sit back, and give a read to this blog because you will learn which credit cards allow cryptocurrency purchases and the advantages of owning them.
Crypto Cards: Credit Cards that allow cryptocurrency purchases
Crypto cards work almost similar to traditional bank cards, but these cards allow cardholders to spend cryptocurrency for real-world purchases such as coffee, restaurant bills, etc. Crypto cards come as crypto credit and debit cards. But in this blog, we will discuss crypto credit cards, in particular.
What are Crypto Credit Cards?
Crypto cards work almost similar to traditional bank cards; in addition, they allow cardholders to spend their cryptocurrencies for real-world purchases. Moreover, crypto credit cards allow cardholders to borrow money from the card issuer for purchases. When using crypto cards you can also earn cashback in the form of cryptocurrencies. Similar to traditional credit cards, crypto credit cards offer rewards, varying from card to card. The rewards are deposited in the cardholder’s account either after every purchase or at the end of the month.
How do Crypto Credit Cards Work?
With crypto credit cards, cardholders are not paying in cryptocurrency. But when he makes a transaction, the card issuer pays for it on his behalf. He has to pay all the amount he used with interest at the end of the month.
The card issuer converts the cryptos he owns into fiat currency and then makes payment.
These cards are issued under the license of VISA and MasterCard. Therefore, they can be accepted at any store accepting VISA and MasterCard payments.
Advantages of Owning Crypto Cards
The following are the advantages of owning crypto credit cards.
These cards allow cardholders to make use of cryptocurrency for daily life purchases very conveniently.
- Cardholders can earn cryptocurrency as a reward/cashback.
- Cardholders can also earn perks such as Netflix/ Spotify subscription, airport lounge access, certain discounts, etc.
- Cardholders do not have to pay a high annual fee; instead, some card issuers do not charge an annual fee at all if a cardholder spends a certain amount within a year.
- These cards do not charge foreign exchange fees. But cardholders will have to pay standard VISA or MasterCard fees.
Best Crypto Credit Cards
The following are some of the best crypto credit cards available out there.
BlockFi VISA Credit Card
BlockFi credit card allows you to earn rewards such as Bitcoin (BTC) cashback. There is no transaction fee, including foreign transactions. Cardholders can also earn a reward of 3.5% for spending up to $3,000 within a year.
However, the card is currently available for U.S. citizens only but will soon be available for the rest of the world in Q2 2022.
Gemini Credit Card
Gemini Credit card is almost similar to the BlockFi credit card. Cardholders can earn rewards in Bitcoin and other cryptocurrencies. The back on each purchase can be up to 3% back. There is an annual and foreign exchange fee.
The card is not launched yet, but crypto holders can join the waitlist.
SoFi Credit Card
The SoFi credit card allows cardholders with active SoFi investment accounts to redeem their points into cryptocurrency. The points can be redeemed into one of the 20 different cryptocurrencies. Cardholders can earn 2% back on eligible purchases. It does not charge an annual fee.
Things to Know Before Using a Crypto Credit Card
There are a few things that you need to consider before using a crypto credit card.
- All crypto cards are not available in every country. Therefore, make sure first whether that card is supported in your country or not.
- You are selling cryptos earned as reward associate taxes. If you are doing so, learn first how much tax you will have to pay.
- Which cryptocurrencies are supported by the card for converting the cashback?
Crypto credit cards are among the hottest topics in the crypto industry these days. But do not fall for FOMO; instead, ask yourself do the crypto rewards make sense for you or not. Be responsible in spending because otherwise, you will have to pay heavy interest on overspending.