Best Crypto Credit Cards: Earning Crypto Rewards

What is a Cryptocurrency Credit Card?

While traditional debit cards are usually attached to a bank account, a crypto debit card allows the user to access the spending power of their Bitcoin and other cryptocurrency holdings. And yes, there are now even crypto credit card options available to those who wish to borrow against their cryptocurrency assets and have the ability to spend them wherever Visa or Mastercard is accepted.

Let’s take a closer look at the crypto credit card ecosystem to see if this merger of the legacy financial system and the digital money of the future could be a good option for your situation.

Do I Need a Crypto Bank Card?

There are a variety of different reasons as to why someone would decide they should opt for a crypto debit card. And for some people, the reality is a crypto prepaid card is one of their only available options for accessing the global economy.

For most people, crypto debit cards will do nothing more than simplify the process of turning crypto assets into cash that can be spent in the real world. Yes, you could hold your crypto funds on an exchange, sell those holdings, and transfer them to your bank account when you need some spending money, but this can be a time-consuming process with a difficult-to-understand user interface that doesn’t make sense in the age of digital money. Crypto debit cards give you the ability to turn your crypto assets into your local currency in a matter of minutes, and you’ll be able to use that cash at a merchant that accepts Visa or Mastercard right away. You can even withdraw physical cash from ATMs with crypto prepaid cards.

While turning cryptocurrency into cold hard cash is the main selling point of crypto debit cards, there are also other perks to consider, such as the ability to instantly access a loan backed by your crypto asset holdings or the ability to earn cashback rewards denominated in Bitcoin or another cryptocurrency.

What’s the Difference Between a Crypto Credit and Debit Cards?

Before we go further, it’s important to differentiate between credit cards and debit cards. A debit card is a card from a financial institution like Visa or Mastercard that allows a user to make card-based payments that pull money from an account where a user has already deposited funds such as a bank account. With a credit card, the user does not necessarily need to have any funds deposited with a bank or other financial institution in order to start spending money. The user is able to spend up to a certain limit every month and is expected to pay back all the money they spent at the end of the month.

While crypto debit cards have been around for years, crypto credit cards are a relatively new phenomenon that allow users to instantly spend money that they’ve borrowed against their crypto-denominated collateral. There are also a number of crypto credit cards in the works that operate the same as traditional credit cards, with the key difference that cashback rewards are paid out in Bitcoin.

What to Look for In a Crypto Credit Card

There are nine key attributes to look for in a crypto credit card.

Ease of use

A crypto credit card needs to be easy to use. After all, the whole point of combining cryptocurrency with the traditional financial system is to make it easier to start using Bitcoin and other crypto assets for everyday payments as quickly as possible. Some crypto debit cards come with attractive rewards and benefits programs that are combined with new experiments in cryptoeconomics that are difficult to understand. For many people, finding a card that simply allows the conversion of Bitcoin into a spendable prepaid Visa card is all that is needed.

Security

It should come as no surprise that security is an extremely important issue for anything related to the world of cryptocurrency. Crypto assets work differently from the traditional payment rails that most people have used in the past. Most important, transactions made on Bitcoin and other cryptocurrency are, generally speaking, irreversible. This means that there is no one you can call for help in a situation where you’ve lost your password or got hacked. For this reason, it’s of the utmost importance that you choose a crypto credit card that allows you to store your cryptocurrency in a secure manner.

Reliability

Reliability is another key concern in the cryptocurrency space. One’s ability to spend money can be extremely important, especially when it comes to tasks like buying groceries or paying rent. You need to make sure that you’re working with a trusted brand when choosing a crypto debit card, as you don’t want to find yourself in a situation where you cannot access your funds.

Fees

While fee structures shouldn’t be the only thing that you consider when choosing between different crypto debit cards, it’s no secret that everyone wants to spend as little as possible on things like processing fees and the cost of withdrawing cash from an ATM. There are a wide variety of fee structures used in the crypto debit card space, so make sure you take a look at the terms and service before you make your decision on which card to get. If you’ve found it difficult to find the fees associated with a particular card, then that card provider may be trying to hide the real cost of using their services.

Features

The add-on features that are included in most crypto debit cards are still somewhat limited right now, as most crypto card providers are interested in nailing down the simple process of converting crypto assets into fiat currency held on a debit card before moving onto other features. That said, most card options do have at least one differentiating feature that allows it to stand out from the rest of the options on the market. When looking at different crypto debit cards, think about your personal situation and see if there are any crypto debit cards that are better suited for your specific needs.

App

Having an app associated with a crypto credit card is basically a requirement at this point. You want to be able to track your balance, transactions, and every other aspect of your crypto debit card at any moment, which means you need an app to handle everything while you’re on the go. One of the most beneficial features found in crypto debit card apps these days is the ability to instantly freeze your card in a situation where it is lost or stolen.

Incentives and Rewards

It should be noted that the level of incentives and rewards that are offered for crypto credit cards is pretty limited at this time. There are a few crypto debit cards that offer cashback rewards of 5% or more, but these offerings are usually packaged with a requirement to buy and hold a large amount of a proprietary token (this holds certain amount of risk). More programs that allow cashback rewards in Bitcoin are continuing to come online, but it may make more sense to think more deeply about other factors for now. A number of cards, like the Crypto.com Visa and the Plutus Debit, offer perks like free Netflix or Spotify.

Availability

Availability is a big issue in the world of crypto credit cards because the regulations around cryptocurrencies themselves seem to be changing on a week-to-week basis. Not only are the laws changing, but companies like Visa and Mastercard will also change their own internal policies on how their partners can deal with crypto assets from time to time. Finding a card that is available globally is a bit of a difficult ask right now, so make sure that your Bitcoin card is actually available in your local country before you make a commitment.

Conversions between crypto and local currencies

There are a number of different factors to consider when it comes to how you will be able to load a crypto credit card with your cryptocurrency of choice. Which crypto assets are supported by the crypto debit card? Are there different fee structures that are triggered when different cryptocurrencies are used to top-up the prepaid card? How quickly are funds available after a deposit has been made? These are the sorts of questions you should be asking yourself when it comes to moving back and forth between crypto and fiat via a debit card.

How Do I Fund a Crypto Credit Card?

While crypto credit cards are obviously focused on making cryptocurrencies more easily spendable on a day-to-day basis, the reality is these cards oftentimes have a variety of different funding methods that can be used. Yes, for the most part, you’ll be looking to convert your Bitcoin, Ether, or other favorite cryptocurrency into your local currency on your Visa or Mastercard debit card, but it doesn’t hurt to have other options, such as direct deposit and bank wires, available to you as well.

When there are a variety of different methods for topping up your crypto debit card, it makes it easier for that card to become somewhat of a replacement for a bank account because you don’t have to worry about having that bank account available for receiving certain types of payments.