How Does a Bitcoin Debit Card Work?
Bitcoin and other cryptocurrencies are digital coins that can be purchased and sent electronically from one entity to another. Like the traditional fiat currency of today, Bitcoin can be used to complete everyday transactions as long as the other person or business will accept it as a payment method. While Bitcoin has mainly been accessed through online exchanges and ATMs, its continued growth has gained the interest of credit card companies. If Bitcoin is something that you use for everyday transactions, you may want to consider getting a Bitcoin debit card. With a Bitcoin debit card, you can easily make transactions using the available funds in your Bitcoin wallet. But, how does a Bitcoin debit card work, how simple is it to use?
What Are Bitcoin Debit Cards?
For the most part, Bitcoin debit cards work just like regular debit cards. The main difference you’ll see is that the money comes out of your Bitcoin balance rather than your bank account and is then converted into fiat currency (any currency that is backed by the government) before being sent to the merchant. When you use your Bitcoin debit card to pay a retailer, it will work the same way as any other purchase you’ve made.
Before you get a Bitcoin debit card, it is important to pay extra attention to the fine print. Like other debit and credit cards, the way the fees are set up can change from one card to the next. Pay close attention to any monthly fees, exchange rates, and penalties. Once you’ve learned about the regulations involved with your Bitcoin debit card, you may find it to be a great alternative to traditional credit and debit cards. Your Bitcoin debit card allows you to have fast and easy access to your money without dealing with the large costs that come with traditional banking.
How Bitcoin Debit Cards Work
To get started, first learn how your Bitcoin debit card works and connect it to your Bitcoin wallet. Once these two have been connected you’ll be able to use your debit card anywhere Bitcoin cards are accepted. If you have a Visa or Mastercard Bitcoin debit card, you can use it anywhere Visa and Mastercard credit and debit cards are accepted. Essentially, what a Bitcoin debit card does is it instantly and seamlessly sells your Bitcoin on an exchange and converts it into fiat currency that can be used in any store. A process that took multiple rounds of back and forth is now just as simple as swiping your card.
Bitcoin debit cards give your purchases the same zero fraud liability that you would get with your traditional credit or debit card purchases. As mentioned above, you’ll want to check with the fine print of your Bitcoin debit card to see what fees may apply.
A difference to keep in mind is that since the value of Bitcoin is always fluctuating, the amount of Bitcoin you’ll need to fulfill a transaction may change even within the span of a few minutes. Make sure to keep track of your Bitcoin amount so you know how much you have available to fully complete a purchase. While Bitcoin debit cards are an easy and great option to use when spending your cryptocurrency, always make sure to have a backup traditional credit or debit card in case the merchant doesn’t accept your card, or Bitcoin has fluctuated to the point that you do not have enough to complete a transaction.
The Future of Bitcoin Debit and Credit Cards
While Bitcoin credit cards are still trying to gain traction in the U.S., the first U.S. Bitcoin credit card may not be too far away. Until then, Bitcoin debit cards are being used (though their use is minimal as of now). As Bitcoin and other cryptocurrencies grow in popularity, the need for Bitcoin credit and debit cards will rise as well. Credit card companies want to take advantage of the cryptocurrency boom that is taking place.
Bitcoin debit cards are the next step toward total and global cryptocurrency acceptance. If you’re interested in finding locations to fund your card, or if you’re interested in simply buying your own Bitcoin, visit one of our Pelicoin ATM locations today.