Credit cards

Crypto-linked credit cards are on the rise – here’s why

There has been a slew of activity around crypto credit cards.

Visa, Inc. (V) recently announced that crypto-related cards accounted for $2.5 billion in payments in its first fiscal quarter of 2022.

“We also provide on-ramps to crypto players creating connectivity with fiat economies. There are over 65 crypto platforms and exchanges that have partnered to issue Visa IDs. This quarter, Visa IDs in the crypto wallets accounted for over $2.5 billion in payments volume, which already accounts for 70% of payments volume for all of fiscal 2021,” said Alfred F. Kelly, Jr. Chairman & Chief Executive Officer , Visa.

Mastercard reportedly announced a Coinbase partnership with the new NFT marketplace. Watch the video above to find out what’s driving all the activity.

This rise in bitcoin and crypto credit cards comes as no surprise to Matthew Sigel, head of digital asset research at VanEck.

The interview above is part of TheStreet’s FREE webinar: Beyond Bitcoin and the Metaverse: Crypto Categories Investors Need to Know, presented by VanEck. The extended conversation helps investors navigate crypto categorization schemes that include: store of value, metaverse, DeFi, infrastructure applications, smart contracts, and more.

WATCH BELOW: Beyond Bitcoin and the Metaverse: Crypto Categories Investors Need to Know – FREE Webinar

Editor’s Note: The webinar was recorded on January 28, 2021.

Related: Sort 12,000 coins in the crypto ecosystem

Video transcript:

Bob Lang: We have seen a wave of partnerships between companies like Mastercard, Visa, American Express, with cryptocurrency giants. What drives all this activity?

Matthew Sigel: What’s driving the activity among credit card companies to release bitcoin credit cards and other crypto credit cards is consumer demand. Consumers are therefore fed up with unelected and unaccountable officials taking so much of their savings, whether in the banking sector or on the web as well. They therefore demand these products and, in return, the market provides them. And we think that’s a big reason why the volatility of crypto, especially Bitcoin, is likely to decline over the next few years. Early adopters of this technology were retail investors who were more volatile in their trading strategies. As the stickiest institutional buyers come into play, sovereign entities like El Salvador, which has declared Bitcoin legal tender, corporations that now own more than 1% of Bitcoin’s outstanding amount, and the next step will be these micro-payments, credit card rewards, games, which will form the base of the pyramid, a constant source of demand, tiny bits of bitcoin being purchased by ordinary people who ask their financial institutions to provide products like these bitcoin credit card rewards. So we’re extremely excited about that. We are trying to work on tracking the wallets associated with these credit cards so that we can begin to assess and determine the extent of demand. But it is a key part of the thesis that Bitcoin volatility should decline over time.

Bob Lang: It’s a good decision for consumers, I think. Mastercard recently partnered with Coinbase for the upcoming crypto exchange NFT market. What could this mean for all actors as well as users? And could we see more partnerships like this down the road?

Matthew Sigel: NFTs truly prove the ability to make digital items rare. The original, the killer app, to demonstrate the market utility was art, profile pictures, you know, digital art files. This year, we believe the utility will expand to include sports ticketing and concert ticketing, as well as game apps. So in the case of ticketing, what if the NBA fieldside ticket you purchased also had a 10% chance of having dinner with one of the players after the game? It is the type of additional goods and services that can be bundled into an NFT, connecting the digital world to the real world. In addition to proving digital scarcity, unlocking a series of benefits for ecosystem participants. It’s the same type of model that these cities, like Miami, try to exercise with their city coins. If you have enough pieces, you might get early access to say a museum or park opening. And in this way, these cryptocurrencies really reward early entrants, strong believers, and incentivize them to do good and avoid evil. And NFTs will enable this type of authorization technology solution and bring a lot of value to consumers over the next year.

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Editor’s Note: Zach Faulds of TheStreet produced this video.