As cryptocurrency has moved from the fringes of finance into the mainstream, credit card companies have taken notice. In recent years, more and more issuers have rolled out crypto rewards cards, allowing you to earn Bitcoin, Ethereum, or other digital assets instead of traditional cash back or points.
While each card works differently, crypto rewards credit cards promise a modern twist on rewards. Essentially, you get the chance to trade traditional rewards like cash back or airline miles for cryptocurrency, with the hope that your digital currency increases in value over time.
But with the promise of high returns also comes the volatility and uncertainty that define the crypto market. Before signing up, it’s worth understanding whether a crypto rewards card is a smart way to invest – or a risky gamble with your everyday spending. Be sure to assess your own risk tolerance, as the value of crypto rewards can fluctuate significantly and may not suit everyone’s comfort level with potential losses.
What makes crypto rewards cards appealing?
The trend toward crypto rewards credit cards started with the introduction of the BlockFi Rewards Visa Signature Card (discontinued) and The Gemini Credit Card in 2021, but other card companies have gotten into the crypto rewards card game since then. These days, the best crypto credit cards come from crypto platforms like Crypto.com and Coinbase, along with other popular companies like the Venmo app, which integrates crypto rewards directly into its platform.
What makes these cards compelling? Instead of earning cash back or airline miles, your everyday purchases can help you build a portfolio of digital assets – no trading experience required. For crypto enthusiasts, these cards create a seamless way to accumulate coins without pulling from their own funds or having any of their own “skin in the game.”
Another big draw of cryptocurrency credit cards is the growth potential. While cash back rewards stay static, the value of your crypto rewards could rise over time if the market performs well. Many cards also offer additional benefits such as travel rewards or purchase protections, enhancing the overall value of using these cards. Some users view this as a long-term play – a chance to turn routine spending into an investment opportunity.
Finally, most crypto rewards cards work much like standard rewards cards, with no annual fees and straightforward earning structures. That familiarity makes it easy for curious consumers to dip a toe into the crypto world without fully diving in.
Who should consider a crypto rewards credit card?
While crypto rewards cards aren’t for everyone, they can make sense for consumers who want to earn credit card rewards differently. Many crypto rewards credit cards have a rewards program structure that determines how you earn and redeem rewards, often including unique features compared to traditional cards. For the right user, they can be a smart addition to a well-rounded financial strategy. Here’s who might benefit most:
Crypto enthusiasts looking to grow holdings
If you already own cryptocurrency and believe in its long-term potential, a crypto rewards card can help you steadily increase your holdings without any additional investment. Instead of buying crypto directly and paying transaction fees, you can earn it passively through your everyday spending. It’s a simple way to accumulate more coins while maintaining your existing investment strategy.
New investors seeking low-risk exposure
For those curious about crypto but hesitant to invest large sums of money, a crypto rewards card offers a gentle on-ramp into the world of digital currency. You’re not risking your own cash — you’re earning digital currency as a bonus for spending you were going to do anyway. This setup lets beginners gain experience with how crypto works and how values fluctuate, without the stress of market timing or major losses.
Users with diversified reward strategies
If you’re a seasoned credit card optimizer who already earns cash back, travel points, or airline miles, adding a crypto rewards card could help diversify your rewards portfolio. Treating crypto as one more rewards category — rather than your main strategy — lets you balance potential upside with more predictable returns elsewhere. It’s a flexible way to explore new territory while keeping your overall rewards plan grounded.
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How to choose the best crypto rewards credit card
Picking the best crypto credit card can feel a little overwhelming at first. After all, you’re not just comparing cash-back percentages anymore – you also need to consider various types of coins, crypto storage options and the potential for growth. Here’s what to focus on when deciding which card is the best fit for you:
Compare reward rates and supported cryptocurrencies
Not all crypto rewards cards are created equal. Some offer higher percentages for certain spending categories, while others may reward all purchases at a flat rate. You’ll also want to check which cryptocurrencies are supported. If you’re partial to Bitcoin, Ethereum, or a specific altcoin, make sure the card lets you earn what you actually want.
Check for annual fees and platform limitations
While crypto rewards cards have the potential to charge annual fees, the majority of these cards are free to use. For example, The Gemini Credit Card, Coinbase One Card, Venmo Credit Card, and Crypto.com Visa Signature Card are all available with a $0 annual fee.
In addition to checking cards for their annual fees and interest rates, pay attention to any platform limitations. Some cards require using a specific app or exchange to access your crypto rewards, which can impact convenience and usability.
Evaluate the ease of converting or withdrawing crypto
Earning crypto based on everyday spending is great, but being able to use it is equally important. Look into how easily you can convert your rewards into cash, transfer them to your own wallet, or spend them directly. Some cards allow you to transfer your crypto rewards to a crypto wallet or external wallet for greater control and security. When you convert crypto to cash, the transaction is typically settled in fiat currency. Additionally, some platforms offer a debit card or debit cards that let you spend your crypto rewards directly at merchants. Cards with complicated withdrawal processes or long lock-in periods might reduce the flexibility of your rewards.
Look for cards with flexible reward options
Some cards give you the option to switch between crypto and traditional rewards like cash back or points. This flexibility can be a lifesaver if the crypto market is volatile or if you simply want to diversify your rewards strategy. A card that lets you choose how to redeem rewards gives you the most control over your benefits.
For example, the Venmo Credit Card earns 1% to 3% cash back in different rewards categories and lets you automatically purchase crypto with the cash back rewards you earn. Cryptocurrencies available for purchase with the card include Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.
Smart ways to use and manage your crypto card
Earning crypto with a credit card can be a lot more exciting than earning cash back, but maximizing your rewards and minimizing risk takes a little strategy. Using your card strategically can help you earn rewards more efficiently. Here are some tips to get the most out of your crypto rewards card:
Use category bonuses to maximize rewards
Many crypto rewards cards offer higher earning rates for certain spending categories like dining, groceries, or travel. Paying attention to these categories and aligning your spending accordingly can significantly boost the amount of crypto you earn each month — without spending any more than you normally would.
Switch reward tokens based on market trends
Some cards let you choose which cryptocurrency you earn or convert rewards into different coins after the fact. If you’re keeping an eye on market trends, you can take advantage of this flexibility to potentially grow your rewards faster or diversify your crypto holdings. Since timing the market can be tricky, however, it’s best to approach this strategically rather than impulsively.
Avoid interest by paying balances in full
Just like with any other rewards credit card, carrying a balance and paying interest on a crypto rewards credit card can quickly erase any rewards gains. Treat your crypto card like any other credit card and pay off your balance in full each month. This will help you keep your rewards working for you, not the bank.
Use tools like Kudos to optimize card usage
Some apps and platforms, like Kudos, can help you track spending, monitor rewards, and optimize how you use your crypto rewards card. These tools make it easier to see where you’re earning the most and ensure that no potential rewards slip through the cracks. With the right tracking system, your everyday spending can become a smart, automated way to build crypto holdings.
Don’t forget about cardholder perks
Beyond crypto rewards, many cards come with extra perks that can add real value. Crypto credit card benefits you may not think about can include travel insurance, 24/7 concierge services, luxury hotel benefits and more.
When comparing cards, factor in crypto card benefits alongside reward rates. Sometimes, the extra conveniences and protections can make one card a better choice than another, but you’ll never know unless you check.
Conclusion
Crypto rewards credit cards offer a unique way to blend everyday spending with the world of digital assets. For enthusiasts, beginners, or savvy rewards users, they can provide an easy path to earning crypto without doing anything out of the ordinary or taking on too much risk.
That said, factors like market volatility, platform limitations, and potential fees mean it’s important to choose the best credit card with crypto rewards carefully. You also have to watch out for pitfalls that come with all types of credit cards, including the potential for exorbitant interest rates and long-term debt.
