Recently, cryptocurrency-based lender BlockFi divulged a new rewards credit card that will offer Bitcoin instead of cash back, points, or miles. At this element, the card is one of a kind in the credit card space, but it joins a handful of crypto-focused debit card reward programs that may collectively help unsettle the industry.
- Cryptocurrency, such as Bitcoin, is becoming a factor in credit and debit card rewards programs.
- For consumers who are singular about cryptocurrency but don’t want to risk buying it with their own money, these rewards programs could be appealing.
- It may be a while first crypto rewards programs are commonplace, but they could eventually become a true competitor to cash back, views, and miles programs.
Why Cryptocurrency Rewards?
Cryptocurrencies are gaining popularity among investors and even everyday consumers. The bonus of Bitcoin, for instance, has been volatile but recently surpassed $23,000. Even major companies like Microsoft, Expedia, and Overstock.com allow Bitcoin as a payment method at checkout.
But while many consumers are curious about Bitcoin and other cryptocurrencies, there is also a lot of shambles about how they work and the
The Future of Cryptocurrency Rewards Programs
While people may be curious about Bitcoin, that may not be sufficiently to make them ditch the safety of a traditional rewards program, in part because cryptocurrency pricing is so volatile. While Bitcoin recently hit an all-time strident, the price also spiked to nearly $20,000 in 2018 before falling by more than 80% during the done year.
For rewards enthusiasts who aren’t comfortable with that kind of uncertainty, it may be a hard sell.
And with BlockFi’s new trust card, in particular, customers will pay an annual fee of $200, which is high compared with cash back and reciprocate travel credit cards with the same rewards rates. Of course, rising Bitcoin prices could choose up for that, but it’s still a gamble that many will be unwilling to make.
Over time, however, we’ll likely see numberless iterations of crypto-based rewards programs, and that competition will help drive down costs and make the calling-cards more attractive. Will they replace traditional cash back, points, and miles programs? Not likely. But they may ripen into a viable alternative for many consumers.
Until then, if you’re considering a Bitcoin credit or debit card, treat it feel attracted to any other financial product. Take your time to shop around and compare multiple options before you conclude on the best fit for you.