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How Do Crypto Credit Cards Work?


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Cryptocurrency is quickly becoming an incredibly valuable ‘asset’ in investment portfolios around the world. According to CoinMarketCap, the value of all available cryptocurrencies is over $2 trillion — and it’s only getting bigger.

Traditional and startup financial service companies have taken notice, and they’re looking to attract new customers with crypto. And rather than a having a credit card that gives travel rewards or cash back on purchases, they’re now cards doling out rewards in cryptocurrency.

Select details how these new type of credit cards work, what to expect and how to evaluate if a crypto credit card is right for your wallet.

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How crypto credit cards work

Crypto credit cards work exactly the same as any other rewards credit card on the market: you’re rewarded as you spend on the card. But in this case, you’re given cryptocurrency for your purchases. However, keep in mind that each card differs in how they process and award the cryptocurrency for their cardholders.

For example, the BlockFi Rewards Visa Signature Credit Card gives cardholders the following:

  • 1.5% back in crypto on all eligible purchases
  • 3.5% back in crypto rewards during in the first 90 days of card membership
  • 2% back in crypto on all eligible purchases over $50,000 of annual spend

But since there are thousands of cryptocurrencies that you can hold, the card actually rewards you with BlockFi Cryptocurrency Rewards Points. Once the points are deposited and the cardholder account is in good standing, BlockFi will let you convert the points into the cryptocurrency of your choice.

Conversely, the Gemini Credit Card deposits cryptocurrency directly into your Gemini account every time you swipe your card — giving you instant access to your rewards — rather than having to wait for the monthly statement to cut.

So when you’re researching crypto credit cards, be sure to find out what the process is for rewarding cardholders. It may require an additional step or two compared to more traditional credit cards, but it could be worth it if you have interest in cryptocurrency investing.

Also keep in mind that not all of these are solely credit cards, as there are several debit cards available such as the Coinbase and Crypto.com debit cards. So if you’re averse to credit cards, you don’t have to miss out on your purchases earning you more crypto for your portfolio.

But remember that the crypto cards still function as normal credit cards, so the balances need to be paid off each month or else you’ll have to pay interest or late fees. While you’ll usually buy things and pay off your card in US dollars, some cards allow you to make purchases (and pay off your card) with cryptocurrency that’s in your associated account.

Additionally, the cards affect your credit score the same way as a traditional card, and there may be fees attached to using the card such as annual fees or transaction fees. Make sure to check the terms and conditions for each card to understand what rules apply.

What to consider with a crypto credit card

Having a crypto card is a bit more complex than a traditional credit card, so here are a few things to consider before you apply:

Crypto cards available now

Bottom line

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.




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