With the recent surge in popularity of cryptocurrency, more and more companies are beginning to offer products and services that allow consumers to utilize cryptocurrency. One such product is the many variations of the Bitcoin rewards credit card. BlockFi was the first company to offer such a card, but now there are options from Gemini, SoFi, Coinbases, Crypto.com, and others. Here’s everything you need to know about Bitcoin rewards credit cards:
What is a Bitcoin Rewards Credit Card?
A Bitcoin rewards credit card is a credit card that allows you to earn cryptocurrency rewards for making purchases with the card. These rewards can be redeemed for BTC or the cash value of cryptocurrency depending on the card you get. Some cards also offer sign-up bonuses in the form of cryptocurrency when you open a new account. Most of these cards require good credit or better to qualify for.
How do Bitcoin Rewards Credit Cards Work?
Bitcoin rewards credit cards work just like any other rewards credit card. You earn points for every purchase you make with the card, which can then be redeemed for cash back or other rewards. The difference with a Bitcoin rewards credit card is that the points you earn are in the form of cryptocurrency, typically Bitcoin.
What are the Benefits of a Bitcoin Rewards Credit Card?
There are several benefits to using a Bitcoin rewards credit card. First, if you’re someone who holds cryptocurrency, it’s a great way to earn more of it without having to put any additional money into buying it outright. Second, since the value of cryptocurrency can fluctuate quite a bit, it’s possible that your rewards could be worth more down the road than they are today. And finally, if you’re new to cryptocurrency and want to get your feet wet without investing any money of your own, a Bitcoin rewards credit card is a great way to do that.
What Are the Disadvantages of a Bitcoin Rewards Credit Card?
As with anything else, there are also some disadvantages to using a Bitcoin rewards credit card. First, since the value of cryptocurrency can fluctuate so much, there’s always the risk that your rewards could be worth less tomorrow than they are today. Second, if you’re not careful about redeeming your rewards wisely, you could end up spending more money than you would have if you had just used cash back or another traditional rewards program. Finally, since cryptocurrency is still relatively new and unknown territory for many people, there’s always the potential for fraud or scams associated with it.
Which Companies Offer Bitcoin Rewards Credit Cards?
Currently, there are several companies that offer Bitcoin rewards credit cards. BlockFi was the first company to offer such a card back in 2019. Since then, Gemini, SoFi, Coinbases, Crypto.com have all jumped on board and now offer their own versions of crypto reward cards as well. It’s important to compare all of your options before choosing a card so that you can find one that best suits your needs.
Mastercard and Visa have both made efforts in the last two years to enable their partners to have more crypto features. Visa has been at the forefront of partnering with cryptocurrency companies to enable their features on the Visa network. In 2019, Visa launched its Cryptocurrency Partners Program to provide guidance and resources to help Visa partners launch crypto-friendly products and services. The program includes a directory of Visa-approved crypto companies, as well as educational resources on blockchain technology and cryptocurrency regulations. Visa has also partnered with several major cryptocurrency exchanges, such as Coinbase and Binance, to offer crypto transactions on Visa-branded debit and credit cards. In 2020, Visa announced that it would be launching a USD-backed stablecoin, which will be available to Visa partners later this year.
Mastercard, meanwhile, has also been partnering with cryptocurrency companies to enable crypto features on its network. In 2018, Mastercard launched its Blockchain API, which allows Mastercard partners to build blockchain-based solutions for payments and other financial services. In 2019, Mastercard invested in Bitcoin wallet provider BitPay, and also launched its own blockchain platform called Mastercard Blockchain Services. Mastercard has also partnered with several major cryptocurrency exchanges, such as Coinbase and Binance, to offer crypto transactions on MasterCard-branded debit and credit cards. In 2020, Mastercard announced that it would be launching a USD-backed stablecoin, which will be available to MasterCard partners later this year.
Bitcoin rewards credit cards are becoming increasingly popular as more companies begin to offer them. If you’re interested in using one of these cards, it’s important to compare all of your options and choose one that best suits your needs. Be sure to carefully consider both the advantages and disadvantages before deciding if a Bitcoin reward card is right for you!