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Crypto Visa Cards in Canada: What you need to know

Crypto

Although it is exciting to see the proliferation of cryptocurrencies, many crypto-advocates and skeptics alike are probably curious as to how exactly crypto-credit cards work. 

Crypto Visa cards work a lot like prepaid Visa cards. To use the cards, funds must be pre-loaded onto the cards. Visa, Mastercard, and other credit companies are partnering with crypto-exchanges. 

These partnerships allow users to easily sell and then immediately convert BTC to CAD, as well as other cryptocurrencies. Once the conversation of cryptocurrencies to a fiat currency has been completed, the funds are used towards the card, which can then be used anywhere. 

It is important to understand several relevant details about many “crypto credit cards”:

When it comes to Visa and Mastercard, these companies are not actually offering crypto credit cards at this point. That means that these cards do not allow users to borrow funds or have a line of credit. They also affect a user’s credit ratings

Crypto Visa cards are prepaid cards, which use cryptocurrency to fund the card with fiat currency. These partnerships allow users to exchange their cryptocurrency for fiat currencies. This means that the credit companies are buying your cryptocurrency, much like an exchange.

Crypto Cards Available 

Although most of the cards on the market are prepaid cards, BlockFli Bitcoin Rewards Card is preparing to work like an actual credit card. It has yet to be released, but currently, there is a waitlist for US residence. This card promises to offer both a line of credit as well as the ability for users to earn Bitcoin by way of rewards points.  

The Nexo Card is another example of a soon-to-be crypto credit card. It is still in development and has a limited release. But users will be about to leverage the value of their cryptocurrencies as credit. Rather than make instant exchanges, users will pay after the fact, much more like an actual credit card, and are approved based on their crypto holdings.

Other cards allow users to earn cashback or cryptocurrencies like reward points. With the Mogo Prepaid Visa, users earn 1% of their spending back in cash can be applied towards buying Bitcoin. That means that the 1% reward is based on the user’s spending, and the rewards are given in a dollar amount. 

That dollar amount can then be used to buy Bitcoin from the Mogo trading platform. Much like other rewards points, the card incentivizes users to use other Mogo partners and platforms. Cardholders are not earning points in Bitcoins, but points that can be converted into BTC.

The Cryptodotcom Midnight Blue Card works with a similar rewards system. Cardholders will earn 1% cashback on every dollar spent using the card, which is rewarded with CRO Tokens. CRO is the Cryptodotcom native token. The CRO tokens earned can be used to buy other cryptocurrencies or exchanged for fiat currencies. 

There is also the option for cardholders to invest a stake in the CRO native token for higher return rewards. If users stake $5000 in CRO, then they will get a 3% reward on card spending. And if they are willing to invest $50,000, the return is increased to 5%. Finally, users can get 8% back on the dollar if they invest $500,000 in CRO. 

Bottom Line

From the user’s perspective, the real benefit of these crypto credit cards is that they are making it very easy to use cryptocurrency too, in effect, make everyday purchases. And, as many of these cards offer rewards points in the form of cryptocurrency, it is a nice way for users to earn a small amount of crypto.

The buyer beware, however, is that the rate of exchange these companies offer is uncertain. It is wise to be sure that users aren’t undervaluing their cryptocurrencies. And the exchange rate will differ between cards and companies, so be sure you read the fine print. 

Disclaimer: This is a paid article. KryptoMoney does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products, or other materials on this page. Readers should do their own research before taking any actions related to the company. KryptoMoney is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods, or services mentioned in the article.

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