Cryptocurrencies have grown popular as an emerging asset class, but did you know that you can use them as a currency as well? We now have more options than ever when it comes to paying for products and services with Bitcoin, which we can do through crypto credit and debit cards.
A long time ago the number of fiat gateways for cryptocurrencies was very limited. Users were mostly restricted to wire transfers and Bitcoin ATMs. But the environment has changed drastically in recent years as financial giants like Visa and MasterCard began to ‘adopt’ Bitcoin and other digital assets.
But what are crypto credit and debit cards and how do they work?
What is a crypto credit/debit card?
Crypto credit and debit cards are not confusing at all, in fact, they function the same as regular payment cards. The only difference is that you are using cryptocurrencies to pay for products and services.
However, you must understand that one does not directly pay with Bitcoin, Ethereum, or other crypto assets. When using these cards, your digital assets are converted into the local fiat currency and are then sent to the merchant.
Crypto credit cards are supported by the help of Visa and MasterCard, two global financial networks. After receiving a license from the companies, a crypto company will issue a crypto card to you which is supported at any store that accepts Visa or MasterCard payments.
Who are these cards for?
Have you fully accepted the world of digital assets and do you believe that fiat money is worthless? Then crypto credit cards are the perfect choice for you! No longer will you be bound to dollars, yens, and euros as you have the freedom to spend cryptocurrencies at all times.
Crypto credit and debit cards make your assets significantly more portable since you basically carry them with you all the time. Want to have dinner at a nice restaurant or have a coffee at Starbucks? As long as they accept Visa you can pay with cryptocurrencies and complete the transactions in only mere minutes.
Previously, it was almost impossible to use cryptocurrencies in stores as the transactions would take up to 30 minutes. But with Visa-based crypto payment cards, you do not have this problem at all.
How does a crypto card work?
Cryptocurrency cards differ in their business model and the way that you spend and store digital assets. Some may not grant you any rewards, some have a tight monthly withdrawal limit, and some even force you to lose your custodian privileges.
If we are talking about custody, we categorize platforms into those that require you to create a dedicated wallet and those that are able to utilize your personal wallet.
In the first case, you would have to transfer your assets to a new wallet or to the platform’s wallet.
Otherwise, you can connect your crypto credit card with the wallet that you already use. By doing so, you remain the sole owner and operator of your digital assets.
Upon connecting crypto funds with the card, you can start making purchases and payments. As previously mentioned, all cryptocurrencies are converted into fiat upon using the card. However, some platforms may require that you convert your crypto into fiat before loading the card with money.
Since all cards are licensed by either Visa or Mastercard, they have the same restrictions and regulations as regular credit cards. For example, you have maximum balances, maximum daily payments, monthly withdrawal limits, and so on.
Certain platforms employ a loyalty system where different groups of users have access to different features. Cashback rewards are the most frequent feature in this context. There may even be tiers through which you can access better card limits, which you can unlock by staking cryptocurrencies.
Top 5 crypto debit and credit cards
In 2020 there are more crypto-based payment cards than ever. Since it is difficult to discover the platforms that work best, we have created a list of the five best crypto credit and debit cards.
Crypto.com MCO Visa Card
Better than any other platform in this respective niche, Crypto.com offers the most popular crypto card solution with the MCO Visa card. In fact, the Hong Kong-based company is a first mover in this market sector and now processes millions of dollars every single day.
The MCO Visa card is simply a debit card through which users can spend their cryptocurrencies. But what makes it so unique compared to other solutions is that it does not force cardholders to exchange their assets into fiat when funding the card.
The card is also popular as a result of its efficient cashback rewards system. Crypto.com rewards cardholders with up to 5% of their total transaction, which is distributed via the native MCO cryptocurrency.
The company offers numerous tiersthat users can access, with each card tier fulfilling certain needs. Here is where the magic starts as higher tiers require you to stake MCO tokens in order to unlock the better cards. As such, we have a positive feedback loop that significantly affects the price of MCO tokens, which you earn by consistently using the card.
Another positive side is that Crypto.com offers its cards in almost all jurisdictions in the world. At the time of writing, users from the UK, EU, US, Singapore, Hong Kong, South Korea, Thailand, Vietnam, Australia, the Philippines, and New Zealand can register for a card. Naturally, the company plans to expand to other regions as well.
What makes the MCO Visa card desirable is the Crypto.com ecosystem itself. Within it, users have access to a smartphone app, a crypto exchange, a wallet, staking services, loans, and even automated trading.
For most, this seems to be the best crypto debit card on the market.
Wirex Visa Card
Operating since 2014, Wirexis another safe option for cryptocurrency enthusiasts. Based in the UK, Wirex is one of the oldest companies that offer crypto debit cards.
Upon making a payment, the Wirex Visa card will instantly convert your digital assets to the local currency at the best interbank and OTC rates without paying any exchange fees at all. The card supports 18 individual cryptocurrencies and traditional currencies.
The company markets its product as the best solution for traveling abroad. All payments made in a local currency will save you 3% per transaction. Just like using the card in your own country, Wirex does not charge you with exchange fees and high conversion rates when overseas either.
While Wirex’s card offers exceptionally good services, its features are far poorer compared to the MCO visa card. For example, this crypto debit card enforces a monthly limit of up to $400 for ATM withdrawals. Additionally, the cashback rewards are far lower, with only 1.5% per transaction.
In comparison, Crypto.com’s card features 5% cashback and more than $2,000 monthly withdrawals. Moreover, the Wirex card charges higher fees compared to its competitors.
Nevertheless, Wirex is still a great solution if you are looking for security. As a regulated company based in the UK that operates successfully since 2014, you will find no brand that is more reputable than Wirex.
Coinbase’s crypto cardis an extraordinary option that launchedfor the first time in Europe in 2019. Enthusiasts consider the card to be the second-best after Crypto.com’s MCO card. Based on the Visa payment system, it offers up to nine different crypto assets which include:
To fund the card, Coinbase customers can directly transfer cryptocurrencies from the exchange’s wallet. But while the card may be simple to use, it comes with significantly higher fees - which is in line with every other Coinbase product and service.
Coinbase features ATM withdrawal limits even lower than Wirex, with only $200 per month. When withdrawing cash, users have to pay 1% fees and 2% fees when overseas. In this case, overseas withdrawals are far more expensive as each transaction charges 3% in total.
Why is the Coinbase Card such a great option? Because it comes from a regulated and trusted exchange that has worked flawlessly for years. It also offers several great features and is connected to the rest of Coinbase and everything that the platform offers.
Do you want to use a crypto card but also trade at the same time with the funds? Simply use the Coinbase card and seamlessly transfer funds between your exchange account and the card’s wallet.
However, we do have to note that the number of supported crypto assets is severely limited. Considering that an exchange offers the Visa debit card, it is concerning that it only hosts nine assets.
Nexo Crypto Credit Card
Next up on the list is Nexo. Why is it special? Because you can take extraordinary loans which a bank would not usually give. The platform supposedly gives loans worth up to $2 million, something that we cannot find anywhere else.
For loans, a user would have to create an account and finish a standard KYC (Know-Your-Customer) process. After successfully identifying yourself, you can create a loan as soon as you deposit your crypto assets.
The crypto credit card is accessible through the Nexo Wallet App where you can manage funds and loans. According to the platform, more than 40 million merchants in the world support Nexo. The card itself only holds cryptocurrencies, which means that you do not have to convert your assets ahead of time.
One cool thing about Nexo is that you can freeze your card at any time. If you ever lose your card or have it stolen by someone, you can instantly lock the card directly from the mobile app. Likewise, you can unfreeze the card if you find it. With that in mind, you will never have to deal with customer support. Everything is managed by yourself, just as it should be!
Nexo grants 2% cashback rewards on all transactions, which are distributed either through the NEXO token or Bitcoin. Additionally, the platform does not charge any deposit or withdrawal fees, which makes it one of the most cost-effective crypto cards.
TenX Crypto Debit Card
Last but not least, we have the famous TenXcrypto debit card. It is a popular option used mostly by crypto users living in Asia. The company began its first steps in 2017 after collecting $80 million during an ICO token sale. After that, the team has launched its revolutionary TenX Visa card.
Recently, the company decided to remove almost all fees. Since October, TenX does not charge foreign exchange fees, deposit fees, or withdrawal fees. However, you will have to pay for in-app exchange rates which are reported to be high compared to other platforms.
Additionally, the platform charges a $15 issuance fee for physical cards or $5 for virtual crypto credit cards. After a year, TenX also starts to charge an annual fee which only costs $10.
At the time of writing, the TenX Visa Card supports the APAC region as well as certain countries within Europe. Naturally, the company seeks to expand in other jurisdictions in the future.
Why is TenX an interesting option? The crypto card is mainly desirable due to its lack of fees for withdrawals, deposits, and foreign exchange charges. Another great thing about TenX is that you have access to virtual cards as well, which no one else offers.
The range of products for crypto credit and debit cards is truly incredible. There might be a lot of platforms out there that offer cards, but at the same time, there are only a few of them that are worth your time. In this article, we have briefly showcased some of the most popular options.
But how do you pick the crypto debit card that suits you the best? As you can see, fees are the main selling point as they vary with each platform. If fees are your main concern, then you should select an option that charges the least.
But then again, security may be an even bigger concern for you. In this case, it would be better to use a truly reputable and regulated issuer. What do we recommend? Definitely Crypto.com’s MCO and Coinbase’s Visa card. With a vibrant ecosystem filled with many features and tools, you really cannot go wrong.
About The Author:
Marko is a crypto enthusiast who has been involved in the blockchain industry since 2018. When not charting, tweeting on CT, or researching Solana NFTs, he likes to read about psychology, InfoSec, and geopolitics.