Crypto Credit Cards Are On The Rise This Year — Here’s Why

When people think of cryptocurrency, we tend to think of the direct use of or investment in assets like bitcoin, ethereum, and the like. There is another type of crypto asset becoming popular however, in the crypto credit card.

These credit cards emerged a few years ago but are now clearly on the rise, and becoming popular for use with everyday payments. According to CNBC in fact, Visa customers made $2.5 billion in payments with crypto-linked cards in the first fiscal quarter of 2022. That’s an astounding number –– but why exactly is it that so many are starting to opt for crypto credit cards over standard credit and debit cards? Read on for a few reasons why.

1. Crypto Rewards

Crypto rewards are fast becoming some of the most exciting card incentives available. Simply put, when customers make purchases using their crypto rewards credit cards, they are rewarded with small fractions of cryptocurrency rather than traditional rewards (like points, cash back, etc.).

Many customers have taken an interest in these new rewards programs, for different reasons. Some have wondered about cryptocurrency, but have been reluctant to spend their own hard-earned money on digital assets due to the risks involved. Others are avid fans of cryptocurrency and already own some, such that cryptocurrency rewards simply add to their existing collections. Whatever the case, it’s clear that there is significant demand for these card perks.

2. A Higher Credit Score

Making purchases on a crypto credit card and responsibly managing the account are great ways to increase a credit score, which is important for a number of reasons. A post entitled ‘What is a Credit Score?’ by AskMoney explains that a high credit score is helpful when seeking a loan, signing up for insurance, setting up utilities, and more. It will even come into play when you try to rent an apartment or lease a car.

Now, these benefits apply to ordinary credit cards as well. The benefit of a crypto card however is that one typically needs a fairly high credit score (670 or higher) to qualify for a crypto card in the first place. That makes these cards valuable for improving credit scores that are already strong; once you’re already managing your credit cards well enough to develop good credit, securing a new cards and handling it responsibly one of the remaining ways to boost your score even further.

3. Long-term Gains

Another enticing aspect of crypto credit card usage is the opportunity for long-term gains. Customers can see the benefits of making purchases today, and being rewarded with digital coins that can increase in value over time.

Globe Newswire points out that people with crypto credit cards tend to use them card over other cards to make purchases –– thus making the crypto cards default payment options. When these people receive their digital rewards, approximately 90% of them hold on to their cryptocurrency rather than spending or trading it. This in effect means that card users are viewing their rewards as investments.

As the world of digital commerce continues to evolve, financial institutions are finding various ways to adapt. Some are launching new products of their own, such as Apple’s credit card that is about as useful digitally as it is in person. In other cases though, financial institutions are partnering with cryptocurrency and blockchain platforms. This is beginning to produce a legitimate wave of crypto credit cards, and they’re catching on in a hurry.