- Cryptocurrencies are going mainstream as Bitcoin soars to record highs and Coinbase going public.
- Use cases for consumers to pay with crypto are starting to emerge.
- Fintechs are adding crypto rewards to their credit and debit cards to incentivize more crypto spending.
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And while crypto’s popularity has continued to rise, its use cases have remained somewhat limited. Digital currencies like Bitcoin and Litecoin are largely seen as a store of value, albeit a volatile one. Users buy, sell, and hold crypto in wallets hosted by trading venues like Coinbase or apps like Square.
Crypto spending, however, is more nascent. PayPal, which added cryptocurrencies to its app in November 2020, launched a checkout feature for crypto in March, enabling its users to pay with Bitcoin through its network of 29 million merchants.
Card networks like Mastercard and Visa are also betting on more consumer use cases for crypto spend. Both players have programs for fintechs to build crypto capabilities and issue crypto credit and debit cards on their networks.
And fintechs are betting that as spending with Bitcoin becomes more common, consumers will be interested in earning crypto through rewards.
Here’s a look at six fintechs offering crypto rewards in lieu of popular travel points and cash-back schemes.
BlockFi’s upcoming crypto credit card offers 1.5% Bitcoin back
BlockFi, the crypto-focused neobank, announced its plans for a Bitcoin rewards credit card last December.
The card currently has a waitlist. BlockFi said it plans to start sending out cards in the spring this year.
Users spend in dollars with the Visa-powered credit card, and get 1.5% cash back on every purchase. The cash back is automatically converted to Bitcoin and deposited in users’ BlockFi crypto accounts on a monthly basis.
The BlockFi card will come with a $200 annual fee, though there will be a $250 sign up bonus for users that spend more than $3,000 in the first three months.
BlockFi also offers a crypto savings account where users earn up to 8.6% interest on their crypto stores. It also lets users borrow cash against their crypto balances.
Crypto.com’s debit card saw 55% spend growth in 2020
On Crypto.com’s app, users can buy, sell, hold cryptocurrencies, including Bitcoin, Ethereum, and Litecoin. It also has a Visa-powered crypto debit card, which can be funded with both fiat and cryptocurrencies.
There are five tiers of card, depending on how much crypto users hold in their accounts over a period of 6 months, from $0 to $400,000. The more crypto users have, the higher their rewards rate is, from 1% to 8% back on spending. Certain tiers also get reimbursements on subscription services like Spotify,
, and Amazon Prime.
Spending with the Crypto.com card grew 55% in 2020, according to the fintech. Spending categories like groceries and home goods were up, while restaurants and travel were down.
Fold’s debit card gamifies crypto rewards
An app called Fold is also leaning into the crypto rewards space, with a gamified twist. The Visa-powered debit card is funded in USD.
Each time users spend, they get a chance to spin a prize wheel and earn rewards like spending and balance matches, paid in Bitcoin.
Fold represents its Bitcoin rewards in sats, a unit named after the pseudonymous creator of Bitcoin, Satoshi Nakamoto, which represents 0.00000001 Bitcoin. In other words, 100 million sats equals one Bitcoin. With a 50x spending match on a $100 purchase, the user would earn 5,000 sats, currently worth around $3.
To redeem their rewards, users can transfer their Bitcoin rewards to crypto wallets on venues like Coinbase. The fintech offers two membership tiers, one free and one with a $150 annual fee.
Gemini’s upcoming credit card will offer up to 3% back in crypto
Gemini, the crypto exchange founded by the Winklevoss twins, has plans to roll out a crypto credit card in 2021.
While the card isn’t live yet, users can sign up for the waitlist. Gemini plans to offer up to 3% back in Bitcoin and other cryptocurrencies, though other details about the card are not yet clear.
MoneyLion is the latest to offer crypto rewards
MoneyLion, which is preparing to go public via a
, is the latest fintech to announce a crypto rewards play. It’s adding cryptocurrency trading to its digital bank offering, and a feature where users can round up purchases made via MoneyLion’s debit card to the nearest dollar and earn the difference in crypto. MoneyLion will also offer digital assets as cash back from spending.
MoneyLion’s crypto features are slated to launch this fall, and users can currently sign up for a waitlist.
The fintech’s debit card is currently running on Mastercard’s rails. It’s not yet clear if MoneyLion intends to launch a separate card for crypto spend, or if it will be linked to users’ existing accounts.
Uphold is bringing its crypto card to Europe
Trading fintech Uphold, too, launched its crypto debit card in March 2020.
The Mastercard-powered card works in multiple fiat and cryptocurrencies. Users earn 1% cash back on fiat purchases, and when they spend with crypto, they get 2% back the same currency.
In February, Uphold acquired UK card issuer Optimus Cards UK Limited, giving it a foothold in the European market. Uphold plans to roll out its crypto debit card in Europe starting this month.