Crypto debit cards are the easiest way to spend your Crypto instead of HODLing it.
You might intend to spend part of your holdings if you invested in Bitcoin, Ethereum, Dogecoin, or other Cryptocurrencies. However, with the help of Crypto debit cards, customers may find it simpler to use Cryptocurrencies with merchants that do not accept them outright.
Let’s start our journey by understanding the Crypto debit cards.
Crypto debit cards: An introduction
Even if most people are aware of what a debit card is, it’s still important to define it because a Crypto debit card is founded on the same idea. A plastic debit card with your vital account information integrated into it through a chip or scannable barcode is known as a debit card. A debit card can electronically pay for products and services using the funds in the associated account, unlike a credit card.
A debit card establishes a connection between processing firms and your checking account, enabling retailers to process payments using the money in your account.
A Crypto debit card is exactly what it sounds like, so there you have it. A Crypto debit card links your Cryptocurrency wallet to a business that processes Cryptocurrency payments.
With this card, you may use the money in your Cryptocurrency wallet to complete transactions at any business that accepts debit cards.
A significant difference between a Crypto debit card and a conventional debit card is that the former instantly converts the Cryptocurrency you will be using to your selected fiat currency.
How does a Crypto debit card work?
Using a smart mechanism, Crypto debit cards let cardholders use their Cryptocurrency as though it were a kind of money, even though it isn’t recognized. A Crypto wallet will be connected to your Cryptocurrency debit card. Depending on the card, this wallet may be linked to one or more of your personal Crypto wallets, your Crypto exchange assets, or it might be directly pre-loaded with money from a conventional debit card.
At the time of sale or ATM withdrawal, these debit cards sell some of those digital assets on your behalf and transform them into fiat money. So, in essence, the card forces you to keep it pre-loaded with a particular Cryptocurrency or sells some of your Cryptos and transforms them into cash when you use them.
Features to consider before choosing a Crypto debit card
Following is a list of features that you should consider before choosing a Crypto debit card
- Fees: Many Crypto debit cards include fees, but not all of them. Fees for overseas transactions, monthly maintenance, and ATM withdrawals are a few examples. It would help if you selected a card with the fewest potential costs.
- Rewards: Some Crypto debit cards provide bonuses like cashback on Cryptocurrencies. Look for cards with big cash back because these benefits can significantly increase your earning potential.
- Supported currencies: Other currencies are not always supported by Crypto debit cards. You should select a card that supports the kind of Cryptocurrency you desire.
- Availability: Some Crypto debit cards are exclusively accessible in specific regions, such as the EU or the US. Find a debit card that is accepted in your area.
- Other perks: Additional benefits for Bitcoin debit cards are a fantastic extra reward. These can range from standard benefits like refunded ATM costs to unusual ones like free Spotify subscriptions.
Let’s move forward with understanding the pros and cons of Crypto debit cards.
Pros and cons of Crypto debit cards
- Ability to use Cryptocurrencies just like fiat money
- Reduced or eliminated foreign exchange costs
- Multi-currency generally enables diverse spending
- Some cards provide significant cashback incentives in Cryptocurrency.
- Some issuers may waive ATM withdrawal fees.
- A taxable event is started when Cryptocurrency is spent.
- There are certain geographical limitations.
- To spend, your wallet must have funds.
Should you get a Crypto debit card for yourself?
Your Cryptocurrency assets and the value of the card you’re contemplating as far as fees and other criteria are concerned will determine if you should acquire a Crypto debit card.
A Crypto debit card can make sense for you if you’re searching for a means to turn your Cryptocurrency into cash.
Final thoughts: Are they safe to use?
With additional security features like two-factor authentication, biometric scanning, and mobile codes, most Crypto debit cards are as secure to use as most major credit cards. In addition, through a mobile app, cardholders typically may immediately freeze or cancel their card.
However, some believe offline digital wallets are safer than Crypto debit cards. Technically, maintaining money in mobile wallets or online exchanges and moving money from a wallet to the company that issues debit cards can raise the danger of cyber-attacks.Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.