The chase never seems to end. If you already have crypto, you may want more. If you don’t, you’re likely looking for ways to get involved in cryptocurrency. This market has introduced innovative tools similar to what you’re used to in conventional finance, including debit and credit cards.
Crypto debit and credit cards allow you to spend crypto for fiat, add real-world use cases for your assets, and even earn crypto in return. With crypto credit cards that offer rewards, you could earn some crypto just by buying a chocolate bar with your card. These cards offer several benefits, making them ideal for earning cash back on purchases and receiving crypto rewards.
Since the pool of crypto credit cards isn’t large yet, you need to familiarise yourself with the best options and learn how to maximize your returns. This article will help you do exactly that.
Key Takeaways
- Crypto credit cards work similarly to traditional ones, but rewards are earned in cryptocurrency, which can be stored in a linked digital wallet.
- Crypto credit cards offer rewards for fiat-based purchases, while crypto debit cards allow spending crypto directly from your balance. Aside from both, there is also a crypto prepaid card.
- Best crypto credit cards include the Gemini Credit Card, Venmo Credit Card, and Nexo Credit Card, each offering unique rewards and benefits.
- When choosing a crypto credit card, several factors should be considered, including security, fees, limits, supported cryptocurrencies, reputation, and rewards.
What is a crypto credit card?
Crypto credit cards, often called crypto rewards credit cards, work similarly to traditional ones. You can make purchases using your credit line, but you earn rewards in crypto.
A crypto credit card allows you to borrow against your crypto assets and use them for purchases anywhere they are accepted. However, you need to remember that you may incur interest if you don't pay off your full balance by the due date.
You earn points for each purchase using a crypto credit card. The larger the purchase, the more points you earn, which can be converted into crypto. Some cards offer cashback rewards, such as 1% back in Bitcoin (BTC) on all purchases. Then, your earned crypto is typically stored in a linked digital wallet, where you can manage your funds.
This way, you can accumulate crypto without directly buying it. Of course, the rewards aren’t huge, so how much crypto you earn depends on your spending habits.
Best 3 crypto credit cards
Gemini credit card
Features | Details |
Rewards program | Earn up to 4% in bitcoin, ether, or over 50 cryptocurrencies |
Annual fee | None |
Cash advance fee | $10 or 3% |
Late payment fee | Up to $8 |
APR | 17.24% to 29.24% |
Users | Add up to five users |
The Gemini credit card lets you earn cryptocurrency rewards on your purchases through its rewards program. You can choose to receive your rewards up to 4% in bitcoin, ether, or over 50 other cryptocurrencies available on Gemini.
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The Gemini credit card has no annual fee, foreign transaction fee, or exchange fee to claim rewards. However, it does charge a cash advance fee of either $10 or 3%, a late payment fee of up to $8, and a returned payment fee of up to $35. Depending on your creditworthiness, the variable APR ranges from 17.24% to 29.24%. The card offers additional benefits, such as adding up to five authorized users, tracking spending by user, and building credit together.
Remember that you may incur fees for selling or converting your earned crypto rewards, even though there are no exchange fees to acquire them.
Venmo credit card
Features | Details |
Rewards Program | Up to 3% on rewards |
Annual Fee | None |
APR | 15.24% to 24.24% |
Application requirements | Venmo account open for at least 30 days and in good standing |
Users | You can only have one Venmo credit card at a time |
The Venmo credit card offers a rewards program where you earn 3% cash back on your top spend category, 2% on the next, and 1% on all other eligible purchases. At the end of each statement period, Venmo transfers your rewards to your Venmo balance. There is no annual fee, and the APR may be up to 15.24% to 24.24%.
With the cash-back to the crypto feature, you can choose to purchase cryptocurrency using the cash-back rewards you earn automatically. You can select from cryptocurrencies, including Bitcoin and Ethereum. When you enable the auto-purchase feature.
To apply for the Venmo credit card, you need to have a Venmo account open for at least 30 days and in good standing. During the application process, you’ll provide personal and identity information, and Venmo performs a soft credit inquiry, which doesn’t affect your credit score. A hard inquiry will follow if approved, which might impact your credit score.
Once approved, you’ll receive your card within 7–10 business days. If Venmo needs additional information, you’ll get notified to submit it through the Venmo app. Remember that you can only have one Venmo credit card at a time.
Nexo credit card
Features | Details |
Rewards program | 0.5% - 2% crypto cashback depending on loyalty tier |
Annual fee | No monthly, annual, or inactivity fees |
Borrowing rate | Based on loyalty tier: 5.9% p.a. (Gold), 2.9% p.a. (Platinum) |
Eligibility | Available only to personal account holders and EEA citizens/residents. |
The Nexo card features a credit mode that lets you spend borrowed funds while using your crypto as collateral. It links directly to your credit line.
To use the Nexo card in credit mode, you must have enough collateral in your balance or credit line wallet.
The card is available in two formats: virtual and physical. You don't have to make minimum monthly repayments for purchases in credit mode, and there are no monthly, annual, or inactivity fees. Depending on your loyalty tier, you can earn between 0.5% and 2% crypto cashback in credit mode.
Your borrowing rate also depends on your loyalty tier. If you're in the Gold or Platinum tier, you’ll enjoy low borrowing rates of 5.9% p.a. and 2.9% p.a., respectively. Loan interest is compounded and calculated on the principal and any accrued interest.
The Nexo card, however, is available only to personal account holders, so corporate accounts aren’t eligible. To access the card, you must also be a citizen or European Economic Area (EEA) resident.
Pros and cons of crypto credit cards
Advantages of crypto credit cards
- You earn crypto when you spend
- You can use your crypto credit card wherever those networks are accepted.
- When you make fiat-based purchases with your crypto credit card, your rewards can be automatically credited in crypto or converted into crypto
Disadvantages and drawbacks of crypto credit cards
- Some crypto credit cards come with annual fees, penalties, or high interest rates
- Cryptocurrency regulations vary by region; crypto regulations are still unclear or unsettled in most regions.
- The crypto market can be extremely volatile, and the value of your crypto rewards may fluctuate due to market volatility.
- Eligibility criteria may vary depending on the issuer and your location.
- Crypto credit cards are still relatively few.
Crypto credit vs crypto debit cards
Crypto credit cards and crypto debit cards serve different purposes, so you need to understand what each offers before choosing. When you use a crypto credit card, you earn crypto rewards for fiat-based purchases. On the other hand, a crypto debit card lets you spend crypto using your card.
In general, crypto debit cards are more popular than credit cards. You may also come across prepaid debit cards, which you fund in advance before using them. These function like crypto debit cards but rely on preloaded funds instead of linking directly to your crypto wallet.
Consider your financial habits and goals when deciding between a crypto credit card and a crypto debit card. If you prefer to keep your spending under control and avoid overspending, a crypto debit card is the better choice. However, you should use a crypto credit card if you're looking for rewards, flexible repayment options, or increased purchasing power.
Crypto credit card vs. crypto debit card
Crypto credit card:
- Earn crypto rewards for fiat-based purchases.
- Pay for purchases using a credit line in fiat.
Crypto debit card:
- Spend crypto directly from your own balance.
- Convert crypto to fiat instantly for payments.
How do crypto credit cards work?
Typically, a crypto credit card rewards you for making certain purchases by converting a percentage of your spending into cryptocurrency rewards.
You can earn up to 3% in rewards paid in cryptocurrency or as points you can redeem for crypto. Interest on a crypto credit card ranges from about 15% to 27%. Unlike crypto debit cards, these credit cards don’t need direct access to or linking with your digital asset wallet.
Here’s how it works:
- Like any other credit card, you use your crypto credit card to make a fiat-based purchase.
- After your purchase, you earn rewards in cashback or points, which you earn as cryptocurrency.
- The rewards are calculated based on the real-time value of the cryptocurrency you’re earning and are deposited into your linked crypto wallet.
- From your wallet, you can hold the cryptocurrency, spend it directly, convert it to fiat currency, or sell it later.
Crypto credit card vs. traditional credit card
Similarities
- Both cards may have a credit limit, which is the maximum amount you can charge on the card.
- Both cards can have interest rates, fees, and penalties for late payments.
- Both types of cards can offer rewards programs, such as cashback or points.
Differences
- Crypto credit cards reward you with cryptocurrency, such as Bitcoin or Ethereum, while traditional credit cards reward you with fiat currency or other rewards.
- Unlike traditional credit cards, crypto credit card rewards may be subject to exchange rate fluctuations and market volatility.
- Crypto credit cards may offer additional security features, but while traditional credit cards also have security features, they may not be as robust.
- Crypto credit cards may have different fee structures than traditional credit cards, including fees for cryptocurrency conversions.
- Crypto credit cards aren’t as widely available as traditional ones, which are widely adopted, available, and accepted by many merchants.
How to choose the best crypto credit card
Here are factors to consider when selecting a crypto credit card:
Security
You should choose cards with high-level security features like encryption, two-factor authentication, and fraud protection to keep your crypto safe. Also, select cards that prioritize customer support if you lose your card or suspect fraudulent activity. Fast response times from support can help you resolve issues immediately, preventing significant damage.
Fees
Crypto credit card fees can vary, but they can affect how much you benefit from your card. These fees may include interest, annual fees, late payment penalties, card replacement fees, international and local transaction fees. Be sure to understand all associated costs.
Limits
When selecting the best crypto credit cards, consider the card's set limits. These may include a required credit score or a minimum purchase threshold before earning rewards.
Supported cryptocurrencies
Rewards can be redeemed in specific cryptocurrencies, a limited selection, or any crypto you choose, depending on the issuer. Consider whether the card issuer allows you to redeem rewards in your preferred cryptocurrency. Most issuers offer Bitcoin, Ethereum, and stablecoins, and some may also include other altcoins.
Reputation
The issuer’s reputation plays a significant role in your decision. You can check reviews on platforms like Trustpilot or social media. Pay attention to positive and negative feedback to gauge the issuer’s reliability. You can also assess their customer support response times to issues. If you plan to use your crypto card frequently, opt for issuers with a proven track record in the market to ensure fund security.
Rewards
Issuers offer various rewards based on the volume of your transactions or purchases. The types of rewards vary by issuer, so when choosing a crypto credit card, evaluate the available rewards to ensure they align with your financial goals and preferences. Reward rates typically range between 1% and 5% in cryptocurrency. Some cards offer higher rewards for specific types of purchases.
Frequently Asked Questions (FAQs) about crypto credit cards
Are crypto credit cards safe to use?
You’ll find security features like two-factor authentication and card encryption that help protect your transactions.
How do crypto credit reward cards work?
Crypto credit rewards cards allow you to earn cryptocurrency as rewards when you make purchases. These rewards can be redeemed in various ways depending on the card issuer.
Are crypto credit cards available globally?
Crypto credit cards are available in several countries, but their availability and usage may be limited by region. You should check if the card is supported in your country before applying.
Are crypto credit card rewards taxable?
You can consider crypto credit card rewards as "rebates," which are not taxable. Rewards are not considered income.
However, if you earn crypto, it is considered an asset and may be subject to taxes, depending on your region. Consider the tax implications of crypto rewards and crypto in your region before applying for a crypto credit card.
Is there a crypto credit card with no KYC?
You will hardly find one, as most issuers follow the Know Your Customer (KYC) requirements, which include proof of identity.
Conclusion
Overall, finding the best crypto credit card comes down to understanding the top options available, such as those offering valuable crypto rewards, accessibility, and unique benefits. You should explore and compare each card's features, fees, and rewards.
Choosing the best crypto credit card shouldn’t be done blindly. Carefully evaluate other key factors like security, reputation, and the supported cryptocurrencies.
It’s also important to note that some crypto credit cards, such as those from BlockFi, paused services or removed crypto rewards from their offerings. The BlockFi credit card became unusable to existing cardholders and unavailable to new applicants after the cryptocurrency trading and lending platform BlockFi, filed for Chapter 11 bankruptcy in November 2022. So, make sure the credit card you’re considering is still available.
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