The search for Crypto.com card alternatives
Those pushing for better Crypto.com card alternatives have their reasons. These mostly focus on the costs of using existing options and the emerging lack of convenience with existing card options.
Crypto.com issues the Crypto.com card to a section of its users. The card is meant to be an easier way to access crypto assets and spend these on merchant websites and other point-of-sales terminals that accept compatible cryptocurrencies. This card is part of an emerging trend of cards issued by exchanges to enable users to gain e-commerce capabilities with their crypto assets.
One of the main issues confronting crypto users is the problem of convertibility between fiat cash and cryptos. Many banks and regulators across the world frown at fiat-crypto transactions.
So, even if a crypto trader makes money via trading or investing in cryptos, there are few channels for converting these crypto funds to fiat cash for offline use.
Furthermore, the channels are getting fewer and more banks that had pre-existing relationships with centralized crypto exchanges are cutting them, narrowing the options even further. Issuing a prepaid debit card to enable exchange users to convert their crypto funds to fiat funds in card format is a handy solution to the problem. The Crypto.com card was meant to be the solution to allow holders to use their crypto funds as though they were using cash.
Cardholders also get other perks, such as cashback at specific retail shops, airport lounge access, free ATM withdrawals, and cashback when used with the Dosh app. However, there are some other requirements that Crypto.com cardholders must fulfill to enjoy some of these perks and, in some cases, even to qualify to keep using the card.
Some users have found some of these requirements unbearable and are now searching for viable Crypto.com card alternatives.
What is driving the search for Crypto.com card alternatives?
One of the perks users of the higher-tier versions of the card enjoyed was that they would get reimbursement of up to 100% monthly on Amazon Prime, Spotify, and Netflix subscriptions. This has been stopped.
In addition, top-up fees (fees charged for loading the card with crypto funds) have increased in the last year.
Getting the Crypto.com card requires the user to stake some amount of money in CRO tokens, the native token of the Crypto.com exchange. Since the staking is in the native CRO token, it is subject to price fluctuation risks as it is not a stablecoin.
Following on from the last point, the price fluctuations of the crypto market in which the CRO token trades have proven to be a risk factor many card users cannot bear.
If you have followed the market in the last two years, you will find that the value of the CRO token has dropped from just under $1 to a little above 6 cents. That's a massive 95% drop.
If you had staked the minimum of €400 in CRO tokens as required, the value of your staked tokens would probably be less than €2.50. This considerable drop has proven to be a significant disincentive to new users.
There is much talk about unresponsive customer support service, with users waiting long to respond to their questions and inquiries. This adds to the frustration many users are feeling.
What makes a crypto card a viable alternative?
For cards to qualify as viable Crypto.com card alternatives, they should have the following characteristics:
It must have very low ATM withdrawal fees or even none at all.
It must boast similar perks to the card to be replaced or even better. Cashback on purchases appears to be the dominant value-added product on most crypto debit cards.
Ability to use both a physical and virtual card option.
Seamless integration to Apple Pay or Google Pay, the e-commerce payment portals of the dominant companies in the smartphone market, allows the user to make payments across thousands of compatible websites.
If it comes from an exchange that requires staking, the token to be staked should have some resilience against steep price depreciation. For instance, you should have the option to convert the crypto holdings on the card to an interest-earning stablecoin until such a time when the funds are to be used.
The staked amount, if any, should not be too high so as not to expose the user to extreme price fluctuation risks.
Any usage fees should be minimal and should ideally not exceed what is paid for regular fiat credit/debit card usage.
Any additional perks, such as using the funds in the card as collateral for taking crypto loans, would be an added advantage.
It would also help if the company issuing the crypto debit card had a customer support desk that responds promptly to client requests, even though delayed responses from customer support seems to be a common denominator across the crypto world.
With these factors in view, here are a few potential candidates that can serve as Crypto.com card alternatives.
Some Crypto.com card alternatives
Nexo card: The Nexo card supports at least 20 cryptocurrencies and provides 2% cashback on all card purchases. In addition, you can convert the funds on your card to a stablecoin and use the same as collateral to collect crypto loans from the Nexo exchange. Clients can access both the physical and virtual versions of the card, and both integrate with Google Pay and Apple Pay. Users do not pay any inactivity fees.
Gemini card: The Gemini crypto card provides specific cashback on retail purchases, with 3% cashback on dining outings, 2% on groceries, and 1% on all other retail purchases. It is one of the few cards available to US citizens and residents. Cashback is given in BTC or Ethereum, with no exchange or foreign transaction fees. Support is provided for 40 cryptos, and all rewards are paid instantly.
Ledger Wallet Card: Ledger wallet crypto cards were launched in 2021. The card, named the Crypto Life (CL) card, is available to EU and US customers, and is linked to the user's Ledger wallets.
Crypto.com card alternatives have emerged due to the desire for better cashback offers, lower fees, and other perks not found with the existing solution.
However, challenges remain due to the stiff opposition from regulators on crypto-fiat exchange solutions, thus limiting the scope of usage and general accessibility of these cards.
It is hoped that the passage of time will lead to changes in the crypto card industry that will widen the scope of access to this product.
Author: Eno Eteng
Eno is a certified financial technician and member of the UK Society of Technical Analysts. He loves to trade and write about cryptos, FX and CFDs. Since 2009, he has been a consultant for several companies in the financial market space. His work can be seen on several forex and crypto-related blogs and trading educational websites.