This upstart company just unveiled a no-annual-fee card with up to 3% back -- here's why we're intrigued

Cryptocurrency is soaring in popularity, and the competition for crypto-earning credit cards is seriously heating up.

Instead of rewarding cardholders with cash back, points or airline miles, these cards will earn crypto -- including popular currencies such as bitcoin. While there’s no guarantee about the future value of cryptocurrencies, this type of reward has the potential to appreciate, unlike most other reward types.

The first crypto cards are set to be unveiled later this year, including ones from Gemini and BlockFi.

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Gemini, a cryptocurrency platform, is announcing that it is teaming up with Mastercard to offer a number of unique features on its new rewards credit card set to launch this summer.

The no-annual-fee card will earn up to 3% back on purchases with crypto rewards automatically deposited into the cardholders’ Gemini account. There's the option to earn any of the more than 30 cryptocurrencies available on Gemini, including Bitcoin.

Category bonuses will include 3% back on dining, 2% back on groceries and 1% back on everything else. Cardholders also have the option to deposit their crypto rewards into a Gemini Earn account, a new interest-earning program, to grow their holdings further.

Interestingly, Gemini says that cardholders will also receive their crypto rewards instantly as the transaction occurs. For a crypto card, this may be particularly beneficial, since the price of rewards could appreciate over time. Instead of waiting until month's end to earn rewards, you'll get them in real-time.

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Gemini says that more than 140,000 people are already on the waitlist for this new card that will be available in all 50 U.S. states. On paper, the card appears to be a very competitive offering considering its no-annual-fee nature and category bonuses.

The sleek, metal contactless card will be available in black, silver or rose gold and will also include World Mastercard benefits such as discounts with DoorDash, HelloFresh, Lyft and ShopRunner.

In a written press release, Gemini CEO Tyler Winklevoss said, “As more consumers look to enter the crypto ecosystem, the Gemini Credit Card gives them an easy point of entry, an effortless way to earn crypto as a reward, and diversify their portfolios over time without changing their daily spending habits."

Bottom line

Gemini's rewards card offering isn't the only crypto launch happening this year. BlockFi also announced details of its crypto credit card, a $200-a-year product that will earn a flat 1.5% back. However, for now, it seems Gemini has a leg up on BlockFi, with no annual fee and up to 3% back in crypto earnings.

Of course, perennial no-annual-fee cards such as the Citi® Double Cash Card or the Chase Freedom Unlimited are some of the best on the market today, although they don't offer cryptocurrency rewards.

The Citi® Double Cash Card earns up to 2% cash back on all purchases — 1% when you buy and another 1% when you pay your bill. Meanwhile, the Chase Freedom Unlimited earns 1.5% cash back on all purchases with an elevated earning rate on travel purchased through Chase Ultimate Rewards (5%), dining at restaurants (3%) and drugstore purchases (3%).

Those earnings can in turn be converted to crypto but the process isn't nearly as seamless as what Gemini is saying it will offer cardholders. Over the coming months, we'll see if this is the card that will bring crypto even further into the mainstream spotlight.