Since the Coinbase card offers you the opportunity to earn rewards on every purchase you make with the card, the easiest way to earn as many rewards as possible is to use it for all of your purchases. Depending on which crypto you choose to earn your rewards in, you’ll be rewarded at the following rates:
- 4% back in Stellar Lumens (XLM)
- 4% back in The Graph (GRT)
- 1% back in Bitcoin (BTC)
- 1% back in Ethereum (ETH)
- 1% back in Dogecoin (DOGE)
- 1% back in Dai (DAI)
While you choose to spend any balance you have of the 35+ supported assets on Coinbase, don’t forget that you’ll be charged a 2.49% transaction fee when doing so for Coinbase converting that asset to dollars for you to complete the transaction. In our view, this significantly limits the usefulness of the card as there is no sense in paying a 2.49% fee just to earn 1% in rewards.
There is one easy way around this fee, though, that we highly recommend. If you hold a balance of the USDC stablecoin (a coin pegged to the price of the U.S. dollar) and set this as your crypto payment method, then you won’t be charged the 2.49% crypto conversion fee! Plus, by spending a stablecoin instead, you’ll leave a larger balance of your other assets that ideally will benefit from price appreciation.
If you’re looking to grow the crypto rewards you receive from your Coinbase card as fast as possible, one of the best ways to do so is by staking those rewards on Coinbase.
For the uninitiated, staking lets you earn passive income with your crypto by contributing to the Proof of Stake (PoS) network of the asset you are staking. Staking your crypto makes the blockchain that powers that asset more secure and more efficient. In exchange, you get rewarded with more assets from the network.
Currently, Coinbase offers staking rewards for 6 assets at the following rates:
- Ethereum (ETH) — 5% APY
- Alogorand (ALGO) — 4% APY
- Cosmos (ATOM) — 4% APY
- Tezos (XTZ) — 4.63% APY
- Dai (DAI) — 2% APY
- USD Coin (USDC) — 0.15% APY
Staking is a great way to further benefit from your crypto holding because if you’re planning to hold onto it as a long-term investment anyways, staking allows you to take advantage of compound interest by receiving passive rewards payments for doing so.
Of the above assets, only 2 are eligible rewards assets with your Coinbase card: Ethereum and Dai. Of course, you could earn rewards in 1 asset, and then trade them for another — which brings us to our next section.
Once you receive your rewards payment from your purchases with the Coinbase card, those rewards are yours to do as you wish. As you may know, Coinbase originally started as a cryptocurrency wallet and trading platform, and while you used to be able to trade just 3 assets on the platform, that figure has now ballooned to 35+.
So if you ever want to trade your rewards for another asset that allows you to stake, or for another that you believe has better growth potential, you can easily do so on the Coinbase platform.
Selling for Cash
Lastly, you can easily sell the crypto rewards you receive from your Coinbase card for cash at any time you’d like. Doing so is quick and easy, and then you can withdraw the cash to your physical bank account.