PayPal-owned Venmo Rolls Out “Cash Back to Crypto” Option with Credit Card
PayPal-owned Venmo announced the expansion of its cryptocurrency support with the launch of a new feature that will allow its users to automatically buy cryptocurrency using the cashback they earned from their Venmo credit card purchases.
The good thing about these automated purchases is that, unlike when buying crypto directly, these will charge no transaction fees. This is similar to PayPal's Checkout with Crypto, allowing shoppers to make purchases using their crypto where it is converted to fiat without any transaction fees.
This feature isn’t a promotion either but is long-term with a crypto conversion spread built into each monthly transaction, said Venmo.
Venmo and PayPal’s regular crypto buying and selling starts at 50 cents for transactions under $25. Then they start charging 2.3% from $25 to $100, a 2% fee for transactions between $100 and $200; 1.8% for transactions between $200 and $1,000; and 1.5% for anything above $1,000.
During Q1 earnings, PayPal CEO Dan Schulman had said that the Venmo credit card “is outpacing our expectations for both new accounts and transactions,” and this past quarter, he noted, the company is seeing “strong adoption and trading of crypto on Venmo.”
Currently, the cardholders of Venmo can earn monthly cashback across eight different categories with up to 3% on their top eligible spending category. Darrell Esch, SVP and GM at Venmo, said in a statement,
“The introduction of the Cash Back to Crypto feature for the Venmo Credit Card offers customers a new way to start exploring the world of crypto.”
To enable the new “Cash Back to Crypto” option, Venmo customers will navigate to the Venmo Credit Card home screen in the app, where they have to select the Rewards tab and then “Get Started.” After agreeing to the terms, the user has to choose the crypto of their choice. Once enabled, whenever cash-back funds get credited to a customer’s balance, it is immediately turned into the previously selected crypto.
This feature can be turned on or off at any time.
Already, Venmo’s over 76 million users can buy, hold, and sell crypto since April, as part of the parent company PayPal’s more significant investment in cryptocurrency.