After years of offering consumers rewards and sign-up bonuses, credit card companies have become more strict about the benefits they offer.
On Thursday, Fold announced that users can now receive a physical card that will allow them to pay at any merchant that accepts Visa and earn 1% to 2% in Bitcoin on any purchase they make.
While physical cards are nothing new in the world of cryptocurrencies, Coinbase recently introduced a Visa card that allows users to pay by connecting to their Bitcoin account, the Fold offering is novel because it allows customers to spend cash and earn cryptocurrencies. . Those who sign up must fund the card through a bank account before using it and receiving rewards, making it something of a hybrid between a debit card and a credit card.
And while the idea of Bitcoin rewards may seem like a niche, Fold CEO Will Reeves believes it will catch on, in part due to efforts by other card companies to impose limits on frequent fliers and other rewards earned.
My answer is that Bitcoin preserves the freedom and flexibility of cash, while also giving it the advantage of being a high-yielding asset, “Reeves said.
Bitcoin rewards are paid at market rates at the time of the transaction. Fold users can transfer the Bitcoin they accumulate to a cryptocurrency wallet, or spend it with retailers within the Fold app, or simply keep it. Card users pay no fees.
While Bitcoin is a notoriously volatile asset, losing around 50% in the market crash due to the coronavirus in recent months, it recently recovered some of those losses. It is currently trading at around $ 7,300, which is still far from its all-time high at the end of 2017 of nearly $ 20,000.
For Fold, joining Visa is an opportunity to expand its rewards program to many more merchants. Currently, the app-based service provides customers with codes to make purchases with select retailers such as Amazon, Uber and REI. The card will mean that users can shop anywhere Visa accepts.
Fold also hopes that so-called gamification elements will increase the appeal of the service. In practice, this means that Fold users will be able to participate in daily in-app promotions, including a spinning wheel that offers rewards of up to 10% at select merchants.
In a statement, a Visa executive said that Fold’s card offering reflects the benefit of the company’s “Fast Track” program, which offers startups access to Visa’s financial expertise and technology.
