Visa and BlockFi Announce Bitcoin Credit Rewards Card for 2021
By Rafał - 2020-12-07
It’s no secret that Bitcoin continues to be one of the most traded cryptos to date. In fact, CNBC reports that Bitcoin’s price climbed above $15,000 recently—a level not seen since January 2018. This was because global governments and central banks actively traded the currency, which helped boost the crypto’s value. But Bitcoin’s monetary amount isn’t the only reason why people love it so much. It’s also because of the increasing number of support and perks, like paying for purchases on Etsy that are exclusive to Bitcoin.
And next year, New York City-based crypto company BlockFi, in partnership with card issuing network Visa, plans to add something to the list: the very first crypto credit card.
What makes crypto credit cards a huge breakthrough?
There are a lot of crypto cards available today, but they mostly come in the form of debit cards. Crypto-dot-com, Nexo, and Monolith are some examples of companies that offer them. Aside from the card rewards and a place to store your crypto money in, they’re not good for much else.
However, a crypto credit card has all the benefits of a regular credit card—which includes installment payments and credit scores. A guide to credit scores by Petal Card outlines how building a high credit score can grant you larger loans and credit limits. It also offers you more privileges, like waived annual fees. These perks don’t just apply to BlockFi’s services, but to other financial institutions too, like banks. So, if you were looking to apply for a car loan at your preferred bank, your BlockFi purchases will make your credit history look more credible.
Other benefits of BlockFi
But aside from the regular credit card perks, BlockFi’s card has a few other benefits. The most notable one being that while it’s called a crypto credit card, the cardholder doesn’t have to spend crypto to pay for their bills. It accepts fiat currency as well. The second perk is that they’ll earn Bitcoin with every purchase. For now, the promised cashback is 1.5% per transaction.
In the first year that it’s released, BlockFi also announced that they’ll be giving people who spend at least $3,000 on the card for the first three months a stipend of $250.
Of course, for all of this card’s benefits, it does come with a cost: an annual fee of $200. There hasn’t been any announcement if it’s possible to waive it with minimum annual spending, but the fee can be deduced from the cardholders’ Bitcoin cashback earnings.
The future of crypto cards
This BlockFi crypto credit initiative is part of Visa’s Fintech Fast Track Program, which aims to speed up the integration of credit cards on every platform. Plus, they want to make crypto more accessible to the general public. Visa had a similar partnership with digital startup Fold to offer a debit card that earns crypto rewards.
“If people don't understand Bitcoin as money yet, they certainly will understand it as a better reward,”
-Fold CEO Will Reeves said during their card’s reveal last April. This new joint venture pushes for the same sentiment.