Credit Cards with Crypto Rewards: Are They Worth It?
Crypto rewards credit cards promise Bitcoin, Ethereum, or other crypto instead of cash back or travel points. But are they actually profitable—or just a gimmick? Here’s a detailed breakdown of the best crypto cards, their real-world value, and whether they beat traditional rewards cards.
🔍 How Crypto Rewards Cards Work
Instead of cash back or miles, these cards give you:
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Bitcoin (BTC)
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Ethereum (ETH)
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Other altcoins (e.g., Solana, Litecoin)
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Tokenized rewards (e.g., Coinbase’s “CB Bucks”)
Key Differences vs. Traditional Cards:
| Feature | Crypto Rewards Card | Traditional Rewards Card |
|---|---|---|
| Reward Type | Crypto (volatile) | Cash back, points, miles |
| Redemption | Into crypto wallet | Statement credit, travel |
| Tax Implications | Rewards are taxable | Usually tax-free |
| Best For | Crypto believers | Budgeters, travelers |
🏆 Best Crypto Rewards Cards (2024)
1. Coinbase Card (Best for Altcoin Rewards)
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Rewards: 4% back in BTC, ETH, SOL, or other cryptos.
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No annual fee.
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Catch: Must hold rewards in Coinbase (can’t cash out instantly).
2. Gemini Credit Card (Best for Bitcoin Purists)
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Rewards: Up to 3% back in Bitcoin (or other cryptos).
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No annual fee.
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Perk: Rewards can be auto-converted to USD.
3. BlockFi Rewards Visa (RIP – Discontinued in 2022)
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Was a top contender (3.5% back in crypto), but shut down after FTX collapse.
4. Venmo Credit Card (Indirect Crypto Option)
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Rewards: 3% back in crypto or stocks (via Venmo app).
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No annual fee.
💰 Crypto vs. Cash Back: Which Earns More?
Scenario: Spend $1,000/month on a card.
| Card | Reward Rate | Yearly Rewards | Value if Crypto 2X’s | Value if Crypto Crashes 50% |
|---|---|---|---|---|
| Coinbase (4% BTC) | 4% in Bitcoin | $480 in BTC | $960 | $240 |
| Citi Double Cash (2% cash) | 2% cash back | $240 cash | $240 | $240 |
Verdict:
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If crypto rises, you win big.
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If crypto falls, you lose vs. cash back.
⚠️ 3 Hidden Downsides of Crypto Cards
1. Rewards Are Taxable
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The IRS treats crypto rewards as income (taxed at your marginal rate).
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Example: Get 500inBTC?Youowe∗∗100–$200 in taxes** (depending on bracket).
2. Volatility Risk
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Your “3% back in Bitcoin” could become 1.5% if BTC crashes.
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Cash back doesn’t fluctuate.
3. Limited Redemption Options
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Most crypto cards don’t let you cash out instantly (must hold or trade).
✅ When a Crypto Card Makes Sense
✔ You already invest in crypto and want passive accumulation.
✔ You believe crypto will appreciate long-term.
✔ You spend heavily in bonus categories (e.g., Gemini gives extra rewards on dining).
🚫 When to Avoid Crypto Cards
❌ You prefer stable rewards (cash back is safer).
❌ You don’t want tax complications.
❌ You don’t trust crypto exchanges (risk of platform collapses).
💡 Pro Tip: Hybrid Strategy
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Use a crypto card for bonus categories (e.g., 4% back on dining).
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Use a 2% cash-back card for everything else (stable returns).
