Some of the leading credit card companies in the game are now trying to make it easier and simpler than ever to spend and earn crypto. Thanks to the increasing popularity of cryptocurrency and new products are emerging virtually every day to keep pace with the trend, and the latest product to emerge in the field is the field crypto card. Being still in the early development stage, many people still don’t know how crypto cards work.
Some difficulties may occur when it comes to spending crypto for making or receiving payments. To solve this issue, cryptocurrency debit and credit cards popped up as a solution. Crypto cards work just like traditional bank cards, though, while using crypto cards to pay for goods and services you use cryptocurrency like Bitcoin, instead of using fiat currency.
Crypto cardholders can rely on their cards for any financial transactions provided the merchant accepts digital currency as a mode of payment.
However, not all retailers accept cryptocurrencies, which means you will have to use fiat money to complete the transaction in this case. Some exchanges only accept MasterCard or Visa credit cards with only a handful of exchanges that accepts American Express credit cards.
With that in mind, cardholders cannot solely rely on crypto cards for all financial transactions.
Why We Should Rely on Crypto Cards for All Financial Transactions
The global digital payment sector has been positively affected by the Covid-2019 outbreak. The market was projected to grow from $5058 billion in 2020 to $5872 billion in 2021 at a compound annual growth rate (CAGR) of 16.1%.
Despite the favorable future outlook, digital payment has some risks that players need to address to ensure the safety of each transaction.
Cryptocurrency can help solve the issues currently facing digital payment and allow users to rely on crypto cards on virtually all financial transactions.
Using crypto cards come with perks of benefits, including:
Better Payment Security
Although the pandemic has contributed massively to the growth of the digital payment market, it has also resulted in an increase in credit card fraud.
In fact, the dollar size of attempted fraudulent transactions increased by 35% in April 2020 compared to April the previous year.
Debit and credit cards were the source of a huge portion of fraud reports in all payments methods.
Making payments using crypto cards is more secure compared to traditional debit and credit cards because digital currencies do not require third-party validation.
When one pays using crypto coins, their data is not stored in a centralized location where data breaches tend to occur. Instead, their details are stored in their secure crypto wallet.
Moreover, the blockchain general ledger is used for verification as well as to record all transactions, making it extremely difficult or even impossible to steal a user’s identity.
Once a crypto payment is done, it is permanent, which is good news to retailers. Crypto’s irreversibility allows business owners to manage their cash flow better. No chargebacks to bother about, and in case someone asks for a refund, the retailer pays them back manually.
Digital currencies charge much lower transaction fees compared to traditional payment methods. For example, PayPal charges up to 4% per each transaction while Bitcoin exchanges charge lower than 1% in fees.
Moreover, if a business serves customers abroad, allowing crypto card payments can help the business avoid international currency payment fees since crypto coins are not tied to a national bank or a single country of origin.
This also means businesses don’t have to wait for payment clearance by a foreign bank.
Accepting digital currencies as a business is extremely easier today than it has ever been. There are a number of payment processors like Easy Digital and Woocommerce that allow for easy integration of crypto payment into business websites.
Businesses can now easily integrate and start accepting cryptocurrency to benefit from the lower fees associated with accepting digital currency payments.
Although crypto cardholders cannot currently rely solely on the cards for all financial transactions, there are many compelling reasons for businesses and big players in the digital payment sector to widely adopt crypto payment. Making payments using crypto cards is secure and with fraudulent transactions rapidly increasing, it should now be considered for all financial transactions. Besides, cryptocurrency is becoming more and more mainstream and retailers should start offering it as a payment option to users.