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Calling all crypto-heads! Last week, crypto exchange operator Kraken announced the Krak Card, a debit instrument that provides cashback in either traditional U.S. dollars or cryptocurrency.
This isn’t the first crypto cashback plastic on the scene and, given the recent upswing in digital coinage, probably not the last. Here’s a brief look at the card and this interesting new niche of the payment card market.
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Release the Krak(en)!
Kraken, which isn’t publicly traded but has filed the regulatory documentation necessary for an IPO, announced the Krak Card last week. The cashback feature returns from 0% to 2% (depending on the user’s total holdings across the Kraken network) on every purchase. It’s affected by either greenbacks or <a href="https://cryptoz7.com/tom-lee-sees-ethereum-at-6k-if-bitcoin-reaches-150k/” title=”Tom Lee Sees Ethereum at $6K if Bitcoin Reaches $150K”>Bitcoin (CRYPTO: BTC).
The company’s timing was fortuitous. The day after it formally announced its product, Treasury Secretary Scott Bessent said the Treasury would, at a minimum, double its regular repurchases of relatively long-term government debt securities.
This unexpected move pushed down bond yields, which in turn increased demand for riskier assets such as cryptocurrencies. Digital coins and tokens took off just after the announcement, and many — like Bitcoin — have generally risen since, albeit at a more measured pace.
Of course, the take-up of the Krak Card and its crypto cashback will depend, to some degree, on prevailing sentiment toward such assets. Wisely, by offering that feature in both dollars and Bitcoin, Kraken hedges its bets.
The competition
Crypto cashback cards aren’t numerous, but there are a few to choose from.
Kraken’s fellow crypto exchange operator, Gemini Space Station, offers the Gemini credit card. Cashback, ranging from 1% to 4% depending on the type of purchase, can be earned in over 50 cryptocurrencies supported by the Gemini network.
The card has no annual fee. Note that this card doesn’t offer fiat currency cashback, but users can opt to receive dollar-pegged stablecoins.
PayPal‘s Venmo offers what’s essentially a crypto cashback card, a credit instrument that returns 1% to 3% to the user, again depending on the type of purchase. The cashback can be used to automatically buy any crypto supported by Venmo. The issuer is PayPal partner Synchrony Financial, and there is no annual fee.
