Back in July 2021, leading global payment service Visa teamed up with BlockFi to create credit cards that utilized the power of crypto currencies. BlockFi credit cards are powered by Visa’s networks and offer bitcoin for every transaction. The first ever crypto rewards credit card, will Visa be driving the future of digital payments and mainstream use of crypto currencies?
Users get 3.5% back in bitcoin for their first three months and 2% back for transactions over £50,000 thereafter. BlockFi boasts that cardholders receive a minimum of 1.5% back for every purchase. The days of cashback are seemingly over, is the future one of digital payments and crypto rewards?
The success of BlockFi was evident—with cardholders predicted to spend more than 50% above what the average credit card user spends a year.
Simplifying Crypto Rewards and Digital Wallet Integration
Since its inception in 2017, Deserve has been backed by Goldman Sachs and Mastercard. Visa is now recognizing the genius of affiliating crypto currencies with mainstream ways of paying.
The system works by offering crypto rewards and points for all purchases. Deserve offers extra concessions and rewards to students, perhaps hoping to drive crypto currency usage in young people. The Deserve card is placed in a digital wallet, compatible with Apple and Android, and transactions work much the same as with any debit or credit card.
However, upon completion of the transaction, cardholders will receive “crypto-back”. Working along the same lines as cashback, crypto-back aims to encourage users to acquire crypto coins like bitcoin and circulate them into everyday transactions, like retail spending.
Deserve boast how quick and easy it is to set up your crypto credit card. Using a mix of AI, machine learning algorithms, employment data and FICO scores, Deserve aims to fasten the credit card application process to make it all the easier for citizens to join the crypto market. You can set up your digital wallet within minutes.
The Real-World Impact of Crypto Rewards Credit Cards
How Crypto Rewards Work with Every Transaction
With every swipe of your crypto rewards card, you earn points that are automatically converted into bitcoin. The actual purchase remains in USD, but the reward is stored in your crypto interest account. This allows users to accumulate digital assets without directly investing their own money.
Fluctuating Rewards Based on Bitcoin Market Value
The amount of bitcoin you earn per point depends on the current market rate. If bitcoin is priced low, your rewards fetch you more crypto, and if the price is high, you receive less. This dynamic makes the system responsive but unpredictable.
Managing Your Crypto Funds Through Card Platforms
Once earned, your crypto rewards are stored in an interest-bearing account on platforms like BlockFi or Deserve. Users can trade, withdraw, or transfer their bitcoin to external wallets or traditional bank accounts. Interest is paid in crypto, further increasing earnings.
Passive Bitcoin Accumulation and Dollar-Cost Averaging
Frequent card use leads to passive crypto accumulation regardless of market conditions. This mirrors a dollar-cost averaging approach, where crypto is purchased incrementally over time. It’s ideal for users who want exposure without managing investments actively.
Limited Regional Availability and Restrictions
While available across most U.S. states, some cards like the BlockFi Visa aren’t approved in regions like New York due to regulatory barriers. This limits access for some users despite the rising popularity of crypto-backed cards.
Rewards with Long-Term Growth Potential
Unlike airline miles or cashback, crypto rewards have the potential to grow in value over time. However, users must also accept the risk of market downturns. Despite volatility, many see crypto rewards as an appreciating asset class.
Lack of Support for Altcoins
Most current crypto credit cards reward users only in bitcoin, excluding popular altcoins like Ethereum or Cardano. This lack of flexibility may deter users seeking exposure to a broader range of cryptocurrencies.
Mastercard and Cathedral Payments Enter the Scene
Mastercard is also integrating crypto into its ecosystem, expanding user choice. Meanwhile, Cathedral Payments allows businesses to accept crypto seamlessly, helping bridge consumer rewards with real-world spending opportunities.
Crypto Processing – The Future Is Digital Payments And It’s Happening Now!
Cathedral Payments enables merchants to instantly accept crypto payments by matching a stable coin pegged to the US dollar. Customers can seamlessly pay for goods and services with digital currencies and the merchant receives payment in US dollars the next day.
Did You Know?
There are currently over 215 million crypto wallet users; in 2020, $5 billion was spent in commercial payments.
How It Works…
Payments are settled in the merchants preferred local currency, directly into their bank account. Besides, Crypto payments are instantly confirmed, without the need for blockchain confirmation. Regulated by MAS, Singapore’s Central Bank, and FinCen, the US Department of the Treasury, Cathedral provides a safe and secure solution for businesses that wish to increase their revenue through crypto payments.
Cathedral removes volatility risk as settlement is done in local currency and directly transferred to a merchants bank account. Add this new payment method within minutes with our APIs or e-commerce platform plugins. Crypto payments in e-commerce are simple and as intuitive as any other payment method. Integrate with platforms like woocommerce, shopify, opencart plugins in just a few clicks.
Merchants can upgrade retail stores with crypto technology and become the most innovative shop around. Settlement is done in local currency to remove volatility risk and automatically transferred to your bank account. We build merchants’ crypto solutions based on their retail needs adapting to existing technology. Merchant and customer payment experience is easy and intuitive as any other payment method. It takes just 4 simple steps to accept cryptocurrency in a retail store.
Capture payments from a whole new type of customer. There are currently 150 million crypto users worldwide. Track orders and payments, streamline accounts reconciliation, facilitate customer refunds. Crypto payments remove all risk of charge-backs, because payments are permanent.
We Can Help!
Cathedral Payments makes accepting Digital Currencies and settling in USD same day simple through our whitelabel checkout solution. Call, Text, or Email Cathedral Payments to access the billions in crypto that is being spent every year!
