When Satoshi Nakamoto wrote his white paper in 2008, he envisioned cryptocurrency as a global digital payment system. While the notion of spending your crypto doesn’t seem especially appealing in this climate, there’s no better time to learn than now. 

This article first explores how crypto cards have quickly evolved to become a bridge between traditional financial institutions and Web3, before exploring its potential future use cases.

Overview of crypto cards

A crypto debit card like the Binance Card works very much like a traditional debit card in how you pay a merchant with the pre-loaded balance in your card (aka funding wallet for Binance Card). 

However, the difference lies in the type of assets in this pre-loaded balance. Instead of fiat currency used for traditional debit cards, crypto cards are loaded with cryptocurrencies. 

A common misconception is that the merchant has to accept crypto as a form of payment. However, the merchant actually receives payment in Fiat. Crypto is converted to fiat in real-time and is paid to the merchant.

Crypto card vs paying via crypto wallets

It is possible to make payments via a self custodial wallet. However, unless the merchant has a wallet address on hand, this process can be extremely tedious. A user has to transfer his/her crypto to an exchange to convert it to fiat and withdraw the amount to their bank account. 

While using a crypto card is less decentralised as this method involves a payment gateway acting as an intermediary in the crypto-fiat conversion, it is definitely much more convenient than doing this conversion manually for each transaction.

Crypto card vs traditional debit card

One of the most obvious benefits of using a crypto card is that you will be able to use your crypto in everyday transactions. 

When using a crypto card, you will be subjected to the market rates of the crypto currency you wish to transact with instead of the exchange rate. Transacting in country A will give you the same rate as country B as long as the crypto card is available in both countries.

Outlook on crypto cards

With the rapid developments of DeFi, dApps and the Metaverse, it is highly likely that crypto cards will be integrated into these developments. 

Many central banks across the globe are considering or even experimenting with Central Bank Digital Currencies (CBDC). CBDC is a digitalised form of fiat currency issued by a central bank. The goals of the CBDC have parallels with crypto in how they seek to improve financial inclusion whilst increasing the speed and efficiency of payments. While the details or implications of CBDCs are not fully spelled out yet, it’s more likely that not that CBDCs will coexist with crypto. 

As the financial system becomes increasingly digitalised, one can expect crypto cards to rise in prominence, given how they already act as the bridge between digital assets and real world merchants. 

Zooming into the Binance Card, it is currently available in over 30 countries across the EEA and LATAM regions, with Brazil being one of the recent additions. The Binance card is set to launch in Colombia and Bahrain soon, with many more countries on the horizon.

Closing thoughts

Perhaps we are still far from the digital global payment system envisioned by Satoshi Nakamoto. However, with crypto cards being the medium to use crypto in a fast and convenient way, crypto cards can potentially be the key to unlocking global mass adoption.

Get your Binance Card now & earn up to 8% cashback!

https://www.binance.com/en/cards

Risk Warning: Digital asset prices can be volatile. The value of your investment can go down or up and you may not get back the amount invested. You are solely responsible for your investment decisions and Binance is not liable for any losses you may incur. Please fund your wallet and perform your transactions cautiously. Not financial advice. For more information, see our Terms of Use and Risk Warning.