The Best Crypto Rewards Credit Card
Cryptocurrency is becoming more and more popular every day. While you may be new to digital currencies, Bitcoin has been around for over a decade, first created in 2009. As this digital currency becomes more mainstream, it's only natural that we would see the emergence of cryptocurrency rewards credit cards. These cards allow cardholders to earn rewards in bitcoin or other cryptocurrencies for spending money on everyday purchases.
So, what are crypto rewards credit cards? How do they work? And which card is the best for you? Keep reading to find out.
What are Crypto Rewards Credit Cards?
A crypto rewards credit card is a credit card that allows cardholders to earn rewards in cryptocurrencies, such as Bitcoin, for spending money on everyday purchases. These cards work just like any other rewards credit card, allowing you to earn points, cash back, or miles for your spending. The big difference is that the rewards are paid out in digital currencies instead of traditional fiat currencies like dollars or euros.
If you're looking to get started with cryptocurrency or find a new way to earn rewards for your spending, then a crypto rewards credit card may be the right choice. However, each card offers unique features with various cryptocurrency reward options and costs. It's essential to read the details and understand what you're getting when signing up for a new crypto rewards card.
How Crypto Rewards Credit Cards Work
Crypto rewards credit cards allow you to earn cryptocurrency, such as Bitcoin, Ethereum, and others, as a reward for your everyday purchases. The crypto rewards are typically paid out as a percentage of your spending. They can be used just like any other cryptocurrency - for shopping, transferring to another wallet or exchange, or holding as an investment.
While the concept of crypto rewards is relatively new, several different crypto rewards credit cards are already available. Most Visa and Mastercard crypto rewards cards are made for consumers. For businesses, dash.fi is the first crypto rewards card.
What to Look for in a Crypto Rewards Credit Card
Signing up for a new credit card can be a big decision. If you're considering multiple cryptocurrency credit cards, you don't have to read the entire fine print to understand how it works. Focusing on a few important areas will help you quickly zero in on the best Visa or Mastercard for your unique needs.
Rewards Rate for Purchases: Unlike a debit card, the best credit cards come with lucrative rewards programs that add to your bank account or business bottom line. Cards often feature a higher bonus rate on specific rewards categories, such as restaurants, travel, gas stations, telecom purchases, or online advertising.
Annual Fee: Some cards require paying hundreds of dollars per year just to have the card. Others come with no annual fee and are completely free to use if you pay them off in full every month and avoid certain fee-bearing activities. With a rewards card and no annual fee, you should end the year with a profit if you use the card well.
Cryptocurrency Redemption Options: Bitcoin rewards are great, but Bitcoin is far from the only cryptocurrency. In fact, cryptocurrency tracking sites list about 10,000 unique currencies. If you're looking for a particular cryptocurrency coin or token for your portfolio at Coinbase or another cryptocurrency exchange, you might be able to get it with credit card rewards.
Rewards Limitations: Some cards put a limit or cap on the rewards you can earn. Whether that applies to bonus categories or your total rewards, it's good to know about any rewards limitations.
Other Rewards Redemption Choices: If you don't want to limit yourself to Bitcoin rewards, you may want a card with flexible redemptions. Some rewards programs also let you redeem for cash back, travel miles or points, travel reservations, gift cards, merchandise, and other rewards.
Card Fees and Charges: You never have to pay any interest charges when you pay off your card balance in full every month, which is a good habit. However, if you carry a balance, it's good to know the card's interest rate – usually displayed as an annual percentage rate or APR. While they're not as commonly required, you may also want to look for foreign transaction fees, balance transfer fees, cash advance fees, and charges for late payments or returned payments.
This isn't an exhaustive list of all credit card features. You might also look for benefits, like auto rental insurance, purchase protection, or extended warranty coverage. What matters most to you or your business is unique, so the benefits you want may not be the same as your friend or family member.
Types of Crypto Credit Card Rewards
There are two main categories of cryptocurrency rewards credit cards. Those are personal crypto rewards cards and business crypto rewards cards.
Personal Crypto Rewards Cards
These are credit cards intended for everyday consumer use. Instead of traditional points or miles, they offer rewards in the form of digital currencies, like Bitcoin, Ethereum, or Litecoin. You might earn a higher rewards rate on purchases made in categories that rotate each quarter. For example, you might earn bonus rewards at Amazon or office supply stores.
Business Crypto Rewards Cards
These are credit cards intended for business expenses. They offer rewards in the form of digital currencies. You might earn a higher rewards rate on purchases made in categories like advertising or travel. Some business crypto rewards cards offer perks like annual bonuses and free employee cards.
The Best Crypto Rewards Credit Cards
For personal crypto rewards cards, you have several competing choices today. These include the BlockFi Rewards Visa, Gemini credit card, SoFi credit card, and a prepaid debit card from Coinbase that enables you to make purchases using your USD Coin balance. Each of these has pros and cons.
Among business cards, the first crypto rewards card is the dash.fi charge card. With dash.fi, you get a limit around 20x higher than most other business cards, allowing you to meet even the highest daily, monthly, and annual spend without getting shut down or having to pay off your balance daily.
dash.fi requires no annual fee, offers top rewards rates for online advertising purchases, and comes with unique security features every business owner or manager will appreciate. It's also available with no minimum personal credit score requirements or founder guarantee. Learn more and apply for the dash.fi card here.
Do You Have to Pay Taxes on Crypto Rewards?
You won't have to pay rewards on cryptocurrency as you earn it, but there may be taxes when you sell or use the cryptocurrency in the future. You will have to pay taxes on any crypto profits generated.
The Internal Revenue Service (IRS) views cryptocurrencies as property, not currency, so they are subject to capital gains tax. If the value of your rewards goes up after you've earned them, you will owe taxes on the gains. Using a cryptocurrency tax tracking app will help you stay on top of taxes, so you don't make any mistakes along the way.