A key obstacle to the adoption of cryptocurrencies is the ability to use them for daily payments. There are not many convenient ways to buy your coffee with cryptocurrency, if possible at all. However, a few exchanges and other platforms are now proposing payment cards that allow users to pay with their crypto anywhere in the world.
The biggest trading platforms such as Binance, Coinbase or Crypto.com are now proposing debit cards for their clients. The innovation is that the balance of the card can be in the digital currencies of your choice. In other words, when someone pays with this type of card, the debited amount from the card's balance is in a cryptocurrency.
The crypto debit cards have a unique reward system. Not only they allow you to pay in the cryptocurrency of your choice, but each time a purchase is made, a cashback is credited back to your crypto balance. And with Crypto.com cards, the more CRO (Crypto.com Coin) you stake, the more advantages you get, going from bigger cashback to fully reimbursed Spotify and Netflix subscriptions.
At the moment, no major payment providers accept cryptocurrencies directly. Although Visa recently announced that transactions in USDC, a stablecoin that is pegged to the U.S. dollar, are supported, it is still only available for the Crypto.com card users.
So, how come you can add Bitcoin, Ether and other altcoins to your card's balance and pay with them? Well, the exchange platforms use third-party card payment infrastructures to make it possible. In the case of Binance, Swipe is the platform that provides this service. It allows real-time cryptocurrency to fiat currency conversion, enabling the possibility to spend crypto assets globally almost instantaneously.
It is interesting to mention the high limits of crypto debit cards. For example, the Crypto.com cards have a €25,000 monthly limit, but Binance's card daily limit is €8,700, equivalent to over €250,000 monthly.
The volatility of the crypto market does not have to be forgotten. It is not unusual to see the market go 10% up one day and see it go 10% down the next. In other words, the balance of the card is fluctuating every day. Therefore, in some cases, there could be some inconveniences if the market goes down too much. The only way to avoid this disadvantage is to only use stablecoins.
To conclude, despite the volatility issues related to the cryptocurrencies themselves, the crypto cards display ingenious technologies and many advantages. It is, therefore, likely they shall naturally be adopted by the masses following the adoption of the currencies.