Credit cards have been prevalent in America since the mid-20thcentury, which allows users to borrow funds for regular spending and repay with some interest and charges. Hence, without carrying cash or even having so much money in your bank account, you can shop online or in physical stores as long as you have a credit card.
The United States credit system ranks citizens based on their creditworthiness from 300 – 850; these figures allow card issuers to determine whether they will issue a card to a user or not; if they do, this number also helps them set a limit on the issued card to ensure that the owner can effectively repay.
To offer customers better value, “reward” credit cards were launched to incentivize customers to use their service instead of another; hence, these credit cards reward users, typically with cashback or points per dollar spent. These rewards can be spent depending on the guidelines of the card issuer.
Crypto credit cards are very similar to reward credit cards and are getting increasingly popular with the rise of cryptocurrency.
What Are Crypto Credit Cards?
Crypto credit cards work like regular credit cards, as they offer you a line of credit with cashback in the form of cryptocurrency. Most issuers allow you to select Bitcoin, as well as other supported cryptocurrencies, within the app.
Unlike crypto debit cards, you aren’t required to fund your wallet in advance or connect to an external wallet for deductions; however, you can make fiat payments and get rewarded with several cryptocurrencies.
Where Can I Get A Crypto Credit Card?
The “credit-based” financial system is more popular in the United States than in other countries; hence, most crypto credit card issuers are based in the United States. Regardless, many of these issuers allow you to make purchases at global points of sale (which may involve a foreign transaction fee or conversion fee).
These issuers usually require intending users to apply for crypto credit cards with personal information like their SSN, income statements, etc., in order to determine creditworthiness. Generally, a good credit score (from 670 upward) is recommended to apply for a crypto credit card; however, some issuers will consider people with 580 FICO scores.
After your application, you may get waitlisted if demand is high; however, you have nothing to worry about if your credit standing is good.
What To Consider Before Choosing An Issuer
Just as the card issuer intends to check your stand and creditworthiness, you should verify their legitimacy and trustworthiness; hence, before committing to any issuer, you should ask yourself the following questions.
- Is the issuer reputable (both in the traditional finance and cryptocurrency spaces)?
- Is this type of reward system the best for me?
- What fees are charged? (check out for periodical membership fees, withdrawal fees, foreign transaction fees, etc.)
- What cryptocurrencies are available for rewards? (It is important to see that the available cryptocurrencies on your chosen platform are optimal for you).
- What conditions do I have to fulfil before obtaining rewards? (This is very important, as most platforms will give stringent conditions before granting you rewards).
- Are there any special benefits? (such as a signing up fee, referral bonuses, etc.)
- Is the card available in my location? (Nearly all card issuers function across all 50 U.S. States; however, some card issuers have problems obtaining a license in New York.)
If you’re a crypto enthusiast who wouldn’t mind a new method to get some cryptocurrency, you should definitely get a crypto credit card. Regardless, it is important to ensure that you NEED a credit card before applying for one; more importantly, you should ensure that you are in charge of your finances – don’t overspend just because you want to hit a reward target; an inability to pay up on time could damage your creditworthiness, and you definitely don’t want that.