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Crypto-Back: What It Is & Why It’s Popular


Is Crypto-Back Becoming the New Cash-Back?

Cryptocurrencies have been around since 2009, and the two largest cryptos are Bitcoin and Ethereum. Investing in these highly speculative financial instruments entails a lot of risks, but now even risk-averse individuals can participate in the crypto craze, and without ever investing a dollar.

So how is this done? With credit cards that offer crypto as a reward in place of traditional rewards like cash-back, points, and travel miles. But are crypto-back credit cards for everyone? Let’s discuss the pros and cons below.

Pros and Cons of Crypto-Back

Pro: Crypto-Back Is a Lot Like Cash-Back

If you’re a credit card holder who’s familiar with how the cash-back incentive works, then you pretty much know already how crypto-back works. When you make a purchase, instead of getting a certain percentage back in cash, you’ll get 1-3 percent back in the cryptocurrency of your choice.

Card issuers that offer this reward have partnered with leading crypto exchanges. Therefore, when a cardholder gets crypto back on a purchase, their preferred crypto will be sent to a digital wallet of their choosing. And since more and more places are accepting cryptocurrency as a form of payment, you can use your stored crypto to purchase anything from a service online to a cup of coffee.

Pro: Low-Risk Introduction to Crypto

With crypto-back, individuals who wouldn’t invest their own money in cryptocurrencies can instead use their credit card issuer’s money to dabble in crypto. Getting crypto-back as a reward is, in a way, gambling with house money. And if you can tolerate a rewards balance that sometimes fluctuates widely, you may be able to tolerate the fluctuations when investing your own money in some cryptocurrencies.

Con: Volatility

The most notable downside of crypto-back is that your total reward balance fluctuates 24 hours a day. A cash-back reward balance, on the other hand, is much more steady, as the US dollar’s value doesn’t fluctuate extremely like the value of Bitcoin or Ethereum.

For example, if you put a $500 purchase on a card that has a base cash-back rate of 2 percent, you’ll get $10 back—and it’ll stay $10 until you use it or until more cash-back is gained. But with crypto-back, you could get $10 worth of crypto-back and then have it only be worth $8 the next day. This is because crypto coins are highly volatile assets. Therefore, one could see their rewards balance cut in half in mere days if it’s in crypto.

How Merchants Can Take Advantage of the Crypto-Back Trend

Merchants that want to take advantage of the crypto credit card trend need to incorporate modern payment processing hardware. Merchant Industry, a leading merchant service, offers the best credit card machines and point-of-sale terminals on the market today. When you open a merchant account with Merchant Industry, all your card processing needs are taken care of, and you can seamlessly accept all kinds of credit and debit cards, even those that are tied to crypto.

About Merchant Industry

In 2007 Merchant Industry was founded by CEO Leo Vartanov on the principle that businesses should be able to purchase credit card machines and merchant accounts at an affordable price while also backed by great service. It was a normal goal at the time, but it helped to change the entire industry. Through Leo Vartanov’s leadership, Merchant Industry pioneered a call center structure to the credit card processing industry Now, 15 years later with well over 20,000+ merchants processing over $5.5 billion per year, Merchant Industry sets the standard for price, customer service, ethics, and integrity.

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