Forget miles, this card pays you back in Bitcoin — Is it worth it?

Dec 7, 2020

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From travel rewards, to cashback to free Starbucks coffee, there are lots of different types of credit card rewards out there. Soon, you’ll even be able to earn Bitcoin rewards.

Crypto exchange platform BlockFi recently announced that it’s partnering with Visa to launch a credit card that rewards purchases with Bitcoin, rather than points, miles or cash back. This will be the world’s first credit card that pays out in Bitcoin, but whether it will actually be worth applying for is another question. The BlockFi Bitcoin Rewards credit card will carry a $200 annual fee and will earn rewards at a flat rate.

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BlockFi Bitcoin Rewards credit card

The $200-a-year BlockFi Bitcoin Rewards credit card will offer cardholders a flat 1.5% cash back that is automatically converted to Bitcoin across all spending. This means you won’t have to juggle specific bonus categories, but could limit your earning potential in popular categories such as dining.

At the time of the launch, new cardholders will be offered a sign-up bonus of $250 in the digital asset after spending $3,000 in the first three months.

(Photo courtesy of BlockFi)

While BlockFi hasn’t released details about benefits yet, it did hint at purchase protections. If this ends up being a Visa Signature card, benefits may include extended warranty protection and various travel protections. What we know for sure is that the card will feature a sleek metal design.

Related: Everything you need to know about Visa Signature card benefits

The card, which will be issued by Evolve Bank & Trust, is set to start shipping in spring 2021. Waitlist registration has already opened for existing and new BlockFi users with funded accounts and will become available to the public in January. It will only be available to U.S. residents in qualified states.

Related: The prettiest credit cards, ranked

Is it worth it?

Bitcoin is the fastest-growing currency and is showing no sign of slowing down. Still, that doesn’t necessarily mean that you should jump on this card. Putting aside the risks associated with investing in such a volatile currency, this card doesn’t provide much ancillary value.

The BlockFi Bitcoin Rewards credit card isn’t all that different from standard cash-back cards such as the Citi® Double Cash Card or the Chase Freedom Unlimited. These cards earn 2% (1% when you make purchases, 1% when as you pay your bill) and 1.5% back, respectively, on general everyday purchases. The Freedom Unlimited kicks things up a notch by also offering 5% back on travel booked through Chase Ultimate Rewards, 5% back on Lyft rides through March 2021 and 3% cash back on dining and drugstores. The key difference is that neither of these cards carry an annual fee, whereas BlockFi’s card costs $200 per year.

And unfortunately, there aren’t really any benefits that justify this annual fee. By comparison, cards such as the American Express® Green Card and American Express® Gold Card, which both carry fairly similar annual fees, come with various credits, such as for Clear and Uber Cash respectively, that help offset its annual fees.

The information for the Amex Green Card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

As such, if you want to begin earning Bitcoin rewards, it could be wiser to continue using a regular, more rewarding cash-back card and then using a commission-free crypto trading platform — such as BlockFi or Robinhood — to invest in Bitcoin using the money you earned. Sure, it won’t be an automatic process, but you would save $200 each year and could potentially earn a better return on your spending.

Related: Should you buy Bitcoin with your credit card?

Bottom line

There’s a new credit card hitting the market that will earn rewards in the form of Bitcoin. However, unless it introduces more benefits, it would be hard to justify its annual fee. If you’re interested in investing in Bitcoin, you could be better off with a regular credit card and using your cashback to buy the digital asset separately.

Featured image by Francesco Carta fotografo/Getty Images.

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