Mastercard and Nexo launched a “Crypto-Backed” payment card

In the previous week, Nexo, a cryptocurrency lender, announced a partnership with Mastercard to produce the world’s first “crypto-backed” payment card. As digital assets grow more widespread, it is the latest step by crypto and established banking networks to link together.

Nexo claims that the card, which will initially be available in a few European countries, allows users to spend without having to sell digital assets such as bitcoin, which are used as collateral to back the credit issued. The majority of traditional credit cards are not secure and have a pre-determined credit limit.

The card is linked to a Nexo-provided crypto-backed credit line and can be used at 92 million Mastercard-accepting retailers globally, allowing investors to spend up to 90% of their crypto assets’ fiat value, according to Nexo. Nexo stated that there are no minimum repayments, monthly fees, or inactivity penalties with this card. For up to 20,000 euros each month, there are no FX fees.

There are no limits on how much a consumer can spend or remove from an open credit line, and interest is only charged on the credit that is spent. Customers with a loan-to-value ratio of 20% or less continue to pay zero percent interest.

Raj Dhamodharan, Mastercard’s head of crypto and blockchain products and partnerships, agreed that digital assets are revolutionizing the financial world. 

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