Coinbase Launches a Visa Rewards Debit Card for US Users; Earn 4% Back in XLM or 1% in BTC
Cryptocurrency exchange Coinbase has released Coinbase Card to allow its users to spend crypto everywhere Visa debit cards are accepted. It also offers the ability to earn up to 4% back in crypto rewards in Stellar Lumens (XLM) or 1% in Bitcoin (BTC).
The debit card is funded by the users’ Coinbase balance, which is touted by the exchange as the “easiest, quickest way to spend your crypto worldwide.”
With Visa partnership, it can be used in millions of locations around the world. For now, the supported countries are Austria, Belgium, Bulgaria, Croatia, Cyprus, Denmark, Estonia, Finland, France, Greece, Hungary, Iceland, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, the UK, and the US, with additional markets to be added later. While it will be open to these countries, the rewards program will only be available to US customers initially.
The card can be used for everyday purchases and works offline, online, and internationally. It can further be used at ATMs for cash withdrawals.
The card has many fees attached to it, starting with £4.95 / 4.95 € fee being the Plastic Card Issuance Fee for customers in the EU and UK, as per its FAQ page, but according to the announcement, there will be no fee for the card itself to US customers.
The page is slim with details on fees, but here is what we see for the EU and UK customers: While for domestic cash withdrawal, for both ATM and Over The Counter “OTC” withdrawals, it charges 1% of the amount per transaction over and above £200 / 200 € per month, for international cash withdrawals, the charge increases to 2% with no changes to the limit.
There is no fee on domestic purchase transactions but 0.2% of the value of POS transactions for Intra-EEA Purchase and 3% internationally.
Coinbase Card has a Chargeback Processing Fee of £20.00 / 20,00 € and a Crypto Liquidation Fee of 2.49% on every transaction.
While it isn't clear yet what the fees associated with each transaction, you need to be wary of the tax nightmare that you will also need to deal with.
Every time you buy something with the card, CB market sells your bitcoin at a premium, with fees on top. Then you technically have to pay 30% taxes on that, and then visa also probably will add their fees on top of that. Crypto credit cards are so dumb https://t.co/9F8Y9XRmc9
— depression BTC (@depression2019) October 28, 2020
Given Coinbase’s history with sharing data with the government agencies, the crypto community isn’t feeling overly excited to provide them with more information.
However, Coinbase does point out that they go to “great lengths to keep all of your sensitive information safe.”