BlockFi’s partnership with Visa
The digital payments leader, Visa and cryptocurrency service provider, BlockFi have partnered up to launch crypto yielding credit cards. You can now earn Bitcoin with your credit card!
Who are BlockFi and Visa?
BlockFi is a non-banking financial company (NBFC). The company provides crypto-backed services such as lending USD loans to crypto owners. The crypto owners put up their crypto assets as collateral to obtain the loans from BlockFi.
They provide many additional services to individual retailers as well as institutions. BlockFi’s aim is “to provide liquidity, transparency, and efficiency to digital financial markets by creating products that meet the needs of consumers and corporations across the globe.”
Visa claims to be the world’s leader in digital payments. Their advanced technology enables their users to conduct transactions globally. They also claim that their technology is capable of recording 65,000 transactions a second.
The aim of Visa is “to connect the world through the most innovative, reliable and secure payment network- enabling individuals, businesses and economies to thrive.”
What does this partnership aim to achieve?
Visa and BlockFi recently announced their partnership to launch Bitcoin-yielding credit cards. This partnership will mark the introduction of the first ever credit card which rewards users in cryptocurrencies.
However, since this feature is relatively new and different than the standard debit cards, both companies have agreed to issue the credit cards to only approved clients on a trial basis. These approved users are solely from the United States of America. The companies plan to expand their product globally if it proves to be successful.
The news of a new credit card that yields crypto related rewards was first announced in December, 2020.
Since then, there have been speculations as to when the credit card would be launched. To everyone’s relief, it is going to be sooner than anyone guessed. The CEO of BlockFi is of the opinion that the shortlisted users are likely to receive their approved credit cards by the end of July, 2021. He further announced that there were approximately 400,000 US based clients in the waiting list as of December, 2020.
How to earn Bitcoin with the credit card?
Now acquiring Bitcoin is easier than ever. With the issuance of this card, you need not go through all the formalities of buying Bitcoin. You can acquire Bitcoin by simply spending money through this credit card. You can receive up to 3.5% Bitcoin on every eligible transaction done via the credit card.
The customers are eligible to receive 1.5% Bitcoin of the total expenditure. The customers will also be eligible to receive 2% Bitcoin on every dollar spent over $50,000 annually.
New customers are eligible to receive up to 3.5% bitcoin for the first 90 days of the issuance of the card or until they receive $100 worth Bitcoin. This scheme is specifically launched to attract more and more customers to transact through their credit cards.
Moreover, there are certain rebates on trading fees and the customers are not required to pay any transaction fee for the same.
How does this benefit both the companies?
Unlike other credit cards, the Visa-BlockFi card is likely to gain popularity quickly. With the growing interest in cryptocurrencies, consumers are likely to apply for the credit card which rewards them.
The revenue stream of both companies is projected to increase at phenomenal rates with this credit card. Consumers will try to purchase maximum goods and services through this credit card in order to earn more rewards.
Moreover, the Visa-BlockFi credit card will compete in the global markets effectively. The superiority in its product is that it provides crypto rewards while other cards provide cashbacks or credit.
The partnership will prove to be a boon for BlockFi, having formed a strong alliance with the market leader in digital payments.
Benefits will be no less for Visa as well. Visa has expanded its reach in the crypto markets spectacularly. It recently announced that its debit cards supported over $1 billion in crypto volumes in the first half of 2021.
This partnership will only facilitate Visa’s emergence in the premature crypto markets.
To sum up, this partnership will revolutionize digital payments and rewards earned through them. Moreover, the crypto markets will see an increase in participants. This participation will essentially be passive participation and not active trading.
Nevertheless, it will help the crypto markets to develop and outshine in the next decade.