Edited by: Juan Ruiz
& Kellie Jez
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Since the beginning of credit card rewards, consumers have mostly had 2 primary options, usually either earning cash-back or travel rewards. Now, a new type of rewards card is hitting the market that could shake up the credit card landscape in a big way — enter crypto rewards cards.
While the crypto industry as a whole is still in its infancy, many companies are now jumping at the opportunity to offer crypto rewards through their current products, while other crypto-native companies are building out full-fledged crypto rewards credit card products.
So whether you’re already a crypto-enthusiast, or are simply looking for a way to diversify your credit card rewards strategy, utilizing a crypto rewards card could be a great fit for you. In this guide, we will take a look at some of these new crypto rewards cards and what they have to offer to customers.
|Card||Welcome Offer and Annual Fee||Benefits|
|Brex 30 Card||
|Gemini Credit Card||
|SoFi Credit Card||
In many ways, crypto rewards cards function exactly the same as any other rewards credit card. Depending on the credit issuer, you’ll have similar underwriting standards that determine your approval and credit line, based on factors like your income and credit score. Crypto rewards cards also share similar payment processing networks like Visa or Mastercard, so they will be accepted by any merchant that accepts these cards.
For the most part, the biggest difference between crypto rewards cards compared to others is that you earn rewards in a set cryptocurrency, like Bitcoin, instead of cash-back or airline miles. This effectively allows you to invest passively in crypto as you make your day-to-day purchases.
|Brex 30 Card|
Brex Mastercard® issued by Emigrant Bank, Member FDIC. Brex Cash provided by Brex Treasury LLC, member FINRA and SIPC. Brex Treasury is not a bank; Brex Cash is not a bank account. Testimonials may not represent experiences of all clients. Terms apply, visit brex.com.
Unlike all other cards featured in this guide, the Brex 30 card is the only small business card currently offering crypto rewards as an option to its customers.
If you’re not already familiar with the Brex 30 card, it is quite interesting in that it does not require applicants to personally guarantee the debt on the card, and instead of credit score, a business’s creditworthiness is evaluated by factors like its cash balance and spending habits.
Brex customers are able to redeem their rewards as a statement credit, or as crypto rewards through TravelBank at a rate of 0.7 cents per point. As of now, crypto rewards are exclusively limited to Bitcoin or Ethereum.
As far as rewards go, cardholders earn points at the following rates:
Statement credits and crypto rewards aren’t your only options for redemptions, though. Brex 30 cardholders can also redeem points on travel purchases through Brex’s travel portal at a rate of 1 cent per point, or through one of the program’s 7 airline transfer partners at a 1:1 rate.
Lastly, the Brex 30 card charges no annual fee or foreign transaction fees. Plus, cardholders do not need to worry about interest charges, as Brex requires any outstanding balance to be paid in full every 30 days.
Gemini, one of the largest cryptocurrency exchanges in the U.S. is also launching its very own crypto rewards credit card. The Gemini card also charges no annual fee, but the rewards structure is a bit different.
Cardholders will earn:
Further, your crypto rewards are not just limited to Bitcoin, but rather can be earned in any of one of the 40+ Gemini-supported crypto assets. The rewards earned from your spending are also received in real-time, allowing you to immediately benefit from any price appreciation.
The card will be available to customers in all 50 states, and will be metal with either a black, silver, or rose gold finish. The Gemini card has an expected launch date of summer 2021, and those interested in the card are currently able to sign up for the waitlist.
Nexo is a platform that allows you to deposit your digital assets so that you can earn a yield on, or take a loan against, those assets without selling them. Nexo offers its own credit card that allows users to earn 2% back on all of their purchases earned in any of the 15+ Nexo-supported digital assets.
The Nexo card charges no annual fee and comes with some solid features like the ability to freeze and unfreeze your Nexo card with a single tap and create free virtual cards for safe online purchases.
The SoFi credit card is designed to help cardholders save, invest, and pay down debt through one of SoFi’s many account offerings. The no annual fee card earns 3% cash back for a year when you set up direct deposit with SoFi. After that, earn 2% unlimited cash back on purchases when redeemed toward investing, saving, or paying down an eligible loan with SoFi.
From there you can redeem those points at a rate of 1 cent per point as cash towards your SoFi Money account, towards paying down your SoFi loan balance, or towards your SoFi Invest account — which allows you to invest in crypto.
However, you should know that when you purchase crypto on SoFi, you’re not purchasing real crypto. What you’re effectively purchasing is an IOU that tracks the value of the cryptocurrency you purchases.
In that vein, your only option for your crypto rewards on SoFi is to buy or sell your current balance into cash. You cannot trade or convert your crypto in another, and you cannot withdraw it off the platform to send to an exchange like Coinbase, or even to put it in cold storage. In our view, this makes the SoFi significantly less compelling for those looking to earn crypto rewards.
It is exciting to see how from the launch of Bitcoin just 12 years ago, the crypto industry as a whole has blossomed into an entire asset class that is helping to usher in a new age of finance. Whether you like it or not, crypto, and now crypto rewards cards, are here to stay. In fact, depending on the success of these current crypto rewards cards, we could see dozens more launched over the coming years.
Ultimately, this new wave of crypto rewards cards is great for consumers, as the more redemption options we have for our hard-earned points the better!
The information regarding the Brex 30 Card and Nexo Card was independently collected by Upgraded Points and not provided nor reviewed by the issuer.
The information regarding the Gemini Credit Card was independently collected by Upgraded Points and not provided nor reviewed by the issuer.
The information regarding the SoFi Credit Card was independently collected by Upgraded Points and not provided nor reviewed by the issuer.
Crypto rewards function the same way any other rewards credit card would, except instead of earning airline miles or cash-back for every purchase you make with your card, you will earn crypto.
While you should consult with a CPA or tax attorney regarding tax questions, any crypto rewards you earn should not be taxed.
In the U.S., crypto is categorized as property, and should only be taxed when you realize a gain by selling or trading one asset for another.
Like all rewards cards, there is no such thing as an all-around “best card.” Rather, there are cards that are best suited for certain people based on their goals and spending habits.
So consider the earn rates, benefits, fees, and other factors associated with each card and then decide which makes the most sense for you.
Crypto credit cards function just like normal credit cards. You apply for the card and, if approved, are given a set credit limit and need to pay off whatever you utilize each month. Of course, you’ll also earn crypto rewards when making purchases with the card.
Crypto debit cards, on the other hand, allow you to spend the balance of your crypto holdings, similar to how you would with a normal debit card tied to a bank account with USD. Many crypto debit cards also allow you to earn crypto rewards for these purchases.
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