Cryptocurrency is gaining traction worldwide, and new products emerge almost daily to keep up with the trend. The latest player on this field is crypto card.
Traditional and startup financial service companies have taken notice, and they’re looking to attract new customers with crypto. The rise of the crypto credit and debit cards are then waving and there’s no turning back. This raises lots of questions—the main ones being, should you get in on the crypto credit card craze and are they worth it?
For some avid crypto enthusiasts, they may feel bothered that they still have to rely on traditional finance in most payment cases. They may also hesitate to use a crypto credit card which can help to go even more bankless than ever before.
Let’s discuss some background on how crypto credit and debit cards work, so you can decide if you should open one up:
Understanding of crypto cards
In the early days of cryptocurrency, crypto users who wanted to use their digital assets to pay for goods and services would have to convert their crypto manually to fiat through third-party platforms and exchanges. This cumbersome process relies on exchanges and ACH transfers that take multiple business days and are a hassle for crypto users. Additionally, these transfers can be prohibitively expensive as more transactions means more fees. Crypto credit and debit cards are the crypto world’s first attempt to solve this problem.
Many fintech institutions like Coinbase have made attempts in this area since 2015 but suffered ceased operations.
In a nutshell, crypto cards work like traditional credit cards. The most apparent difference between them is that crypto cards are connected to the holder's crypto wallet instead of a bank account.
Crypto credit cards maximize purchasing power and simplify buying goods and services with crypto. They work at the checkout just like regular Mastercard or Visa cards.
As a result, crypto enthusiasts can instantly make their portfolios more liquid. Furthermore, due to the volatile nature of cryptocurrencies, they may see their collateral appreciate over time.
Benefits of Crypto Credit Cards
Most credit cards provide users with some benefits. Crypto credit cards are no exception. Here are some of the most common benefits you’ll find with crypto credit cards:
● Cash Back: One of the most apparent benefits of crypto credit cards is that they offer cash back for both the platform and cardholders. Well, technically, they offer crypto back, but users receive funds back either way for simply making purchases. Moreover, depending on the pricing scheme of the card issuing company, cardholders can earn different returns. This is also an intriguing approach for business to attract more users.
● Build Financial Portfolio: One of the top benefits of using crypto credit cards is that they allow users a quick, easy way to build their financial portfolio. Rather than investing in crypto directly, those who frequently use crypto credit cards can buy crypto with reward points.
● Fewer Fees: Given the nature in which crypto is purchased, using crypto credit cards can allow crypto enthusiasts to purchase crypto without paying all of the fees associated with crypto trading; you may be able to skirt fees that are accessed when initiating the trade.
● Reducing Financial Risk: Lastly, many people are interested in investing in crypto, but many are reluctant due to the fact that it’s such a new and unpredictable asset. However, using a crypto credit card can allow you to try out crypt trading without actually putting your own money at risk.
iPeakon Crypto-backed card solution
Aiming to build a unified financial infrastructure, iPeakoin brings crypto-to-card payment solutions to the real economy with scalable CaaS (Card-as-a-Service), which can be integrated into digital businesses’ systems with a few simple codes. Then, businesses can issue crypto-backed cards to their customers, increasing customer loyalty and attracting new investors.
Build your own card solution using modular API to accommodate your business.
Read our documentation, and begin to prototype as you build a solution.
Access to better international interchange rates than other providers.
Empower your users to make transacting with crypto as simple as using a credit card.
Lear more about our CaaS solution at https://www.ipeakoin.com/caas.