It is a rare, if not absolutely impossible, thing to see people buy groceries or everyday products using cryptocurrency. A major barrier to it is actually a lack of liquidity- the inability of paying cryptocurrencies like you would pay a dollar bill. Liquidity basically refers to the ease of conversation from a certain currency (in this case, a cryptocurrency like Bitcoin) into actual goods or services (or even fiat currency like USD or INR). This problem can be tackled to a large extent by using Bitcoin debit cards. With these handy cards, you should be able to swipe on a card machine at your supermarket after getting your groceries. You should also be able to use your Bitcoin (BTC) holdings to make online payments without having to get into the complication of linking your storage wallet. You must be marvelling at this extremely convenient solution and wondering where to sign up! In this article, we tell you exactly what Bitcoin Debit Cards are and how to use them.
What are Bitcoin Debit Cards?
Bitcoin debit cards are quite different from traditional debit cards. Unlike their traditional counterpart, these are prepaid. Just like you’d top up a redeemable card to buy tickets to individual games in a gaming zone, you have to top up this BTC debit card of yours with your virtual coins. Bitcoin debit cards vary from one to the other. Sometimes, the BTC or crypto amount is converted to fiat when the card is swiped during a transaction. In certain other cards, the crypto-to-fiat conversion occurs immediately after the top up. In other cases, the card maybe linked to your usual fiat currency account itself for making fiat-crypto conversions. Clearly, as time passes, the bridge between crypto and fiat is getting increasingly strengthened. Till a while back, you did have the ability to buy Bitcoin using your bank account or with PayPal, but now with BTC Debit Cards, a two-way street seem to be on the “cards” quite literally.
Two Types of Bitcoin Debit Cards
There are two broad categories of Bitcoin debit cards to choose from. Let’s have a look what they are:
1. Plastic Bitcoin Debit Card-
This kind looks and works almost the same way a normal debit card does. It is a tangible card made of plastic with a chip that can be swiped and read by a card swiping machine. It also has the card number, user name, expiration date and CVV written or embossed directly on the card itself. Any vendor that accepts MasterCard or Visa payments can be easily paid using this kind of a card, both offline as well as online. This kind is extremely handy for frequent travelers because it comes handy when one does not have actual cash and can be used to access ATMs.
2. Virtual Bitcoin Debit Card-
This cards have every detail that a plastic card has, ranging from name to CVV, except for the chip and the tangibility of it. This can naturally only be used only for online payments or transactions since no chip exists to make it swipe-able.
How to Use A Bitcoin Debit Card?
A Bitcoin debit card can be used just like you’d use your MasterCard or Visa debit cards. The plastic variants, as we have mentioned above, can be swiped at the vendor’s payment collection machine. For the virtual variant, you simply type out the card details in the relevant fields when the online payment gateway appears and validate it with a pin or a one-time password (OTP). The entire affair is fairly simple and straightforward. Major companies offering BTC debit cards include Wirex, Xapo and Cryptopay.
We know that with passage of time, we are seeing increasingly high levels of crypto adoption. According to a Virtual Coin Squad study reported in July, over 50 major companies were already accepting crypto payments. In fact, this month itself, two major companies in Japan started accepting crypto. However, even this increase is happening at too slow a pace to make a short-term difference, which is why Bitcoin Debit Cards are the best way to combine fiat’s liquidity with the many benefits of cryptocurrencies.