BlockFi Rewards Card Review: Card Is ‘Paused,’ Can’t Be Used
4.1
The card didn't let you earn crypto on your own terms, but it was an easy way to get into crypto with money you weren’t counting on.
- No annual fee
- No reward caps
- No foreign transaction fees
- Complicated rewards
- Rewards have limited flexibility
- Must be a member/customer
- No bonus categories
$0
11.74%-21.74% APR
N/A
$0
11.74%-21.74% APR
Annual fee
$0
Rewards rate
1.5%-10%
Bonus offer
N/A
Intro APR
N/A
Ongoing APR
APR: 11.74%-21.74% APR
Foreign transaction fee
0%
Compare to Other Cards
Detailed review: BlockFi Rewards Visa® Signature Credit Card
» Editor's note:
BlockFi filed for bankruptcy on Nov. 28, 2022. The BlockFi Rewards Visa® Signature Credit Card is now "paused," according to a company representative, and customers cannot use it to make purchases. Per the company: "New cards are not being issued. Clients should continue to make their regular statement payments. Assets held on the BlockFi platform cannot be used toward these payments." We are leaving the content of our review below for reference. For customers wondering what happens to their crypto in a situation like this, we're updating this article as we learn more.
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For many, the allure of the BlockFi Rewards Visa® Signature Credit Card will be the ability to earn cryptocurrency just for doing your everyday purchasing.
It’s an easier-than-normal entry into crypto without first learning all the mechanics of buying and "HODLing" a digital currency. (Unless you live in New York; it’s not available in that state.)
The BlockFi Rewards Visa® Signature Credit Card is mostly a normal Visa credit card, accepted almost anywhere, with a twist: It earns an unlimited 1.5% back in Bitcoin or more than 10 other cryptocurrencies for every dollar you spend on the card. Compared with regular cash-back cards, that’s a decent rate but not great. (It also offers 2% back on every dollar spent over $30,000 annually, a steep threshold limited to big spenders.)
But the people most interested in this card probably aren’t concerned with what their rewards are worth at the time they’re earned. They’re dreaming of potential sky-high appreciation afterward. And if perhaps they’re disregarding the downside — that crypto value could decrease — then all that’s at risk is credit card rewards.
So the main question isn’t whether to invest in cryptocurrency. It’s if you should take credit card rewards in the form of crypto, as opposed to using a different card that offers cash back, airline miles or points. If for you that answer is an obvious yes, then the BlockFi Rewards Visa® Signature Credit Card is a good way to do that.
When the BlockFi Rewards Visa® Signature Credit Card launched in 2020, its rewards were available only in Bitcoin. In November 2021, the card introduced "Rewards Flex," which allows cardholders to receive their rewards in one of about a dozen cryptocurrencies. See below for details.
BlockFi Rewards Visa® Signature Credit Card: The basics
Card type: Rewards, cryptocurrency.
Annual fee: $0.
New-cardholder bonus:
N/A.
Ongoing rewards:
1.5% back in crypto on every purchase.
2% back in crypto on every purchase over $30,000 of annual spending.
Up to 10% back at select merchants and restaurants through BlockFi Offers, a benefit managed by the cash-back app Dosh. You must opt in to this perk through your BlockFi account or the BlockFi app, and you can opt out at any time, too.
Cardholders can choose to earn their rewards in one of about a dozen currencies. The default is Bitcoin, but other options, as of July 2022, are Ethereum, Dogecoin, Litecoin, Chainlink, PAX Gold, Basic Attention Token, Uniswap and Bitcoin Cash, as well as "stablecoin" options Gemini Dollar, USD Coin, Paxos Standard, Multi-Collateral Dai or Binance USD. You're limited to earning one type of crypto each month, but you can change your selection online. Changes take effect the following month.
APR: The ongoing APR is 11.74%-21.74% APR.
Foreign transaction fees: None.
Other benefits:
0.25% back in Bitcoin on all eligible trades, up to a maximum of $500 in Bitcoin each month.
$30 in Bitcoin for every client referral, on top of the base Refer-a-Friend program.
How it works
BlockFi, a New Jersey-based company founded in 2017, is a cryptocurrency financial institution that offers several services, such as a crypto interest account, digital wallet, crypto loan service and trading platform.
The metal BlockFi Rewards Visa® Signature Credit Card earns rewards for spending anywhere that accepts Visa. Rewards are initially earned as points, but they are converted into crypto automatically. (As of this writing, it’s on the second Friday of each month.)
For each reward point, you will earn 1 cent worth of crypto, based on the currency's market price when the redemption transaction happens, less about a 1% spread. So if you earned $100 in rewards, you would get the value of about $99 in crypto at that moment in time. Spread charges are common in cryptocurrency transactions.
Thus, each month you would receive more crypto for your rewards points if the price is low; less if the price is high. But you have no control over timing. Reward points have no other redemption option except for automatically buying crypto.
Rewards are held in a BlockFi account — you must create an account before applying for the card — and can be withdrawn to an external crypto wallet or to a bank via wire transfer. BlockFi offers one free crypto withdrawal and one free stablecoin withdrawal per calendar month.
To be clear: When you make a purchase with the BlockFi Rewards Visa® Signature Credit Card, you are spending dollars, as with any other credit card. And you pay your credit card bill in dollars. But the rewards you earn are crypto. If you want to spend crypto directly with a payment card, you’re probably interested in a cryptocurrency debit card. It allows you to spend crypto with merchants that accept Visa or Mastercard but don’t directly take crypto.
Benefits and perks
Rewards are in crypto
The rewards are the first, foremost and overriding reason to get this card.
Compared with other flat-rate cash-back credit cards, the rewards rate is decent, but not great, on the BlockFi Rewards Visa® Signature Credit Card.
The ace up its sleeve is being able to regularly earn crypto as rewards, instead of cash, points or airline miles. So while the rewards rate might not be all that superior when you earn it, crypto could appreciate dramatically to ultimately make those rewards extremely valuable. Of course, the rewards could lose value, too.
No hard credit pull for an offer
In applying, you’ll first seek preapproval. Those who qualify will get an offer to become a customer.
Preapproval involves a "soft pull" — or soft inquiry — on your credit, meaning it won't lower your credit scores. If you accept the card offer, the issuer will do a hard pull on your credit, which could lower your scores like almost any other new credit card account. The decrease is usually temporary and amounts to a few points, but it depends on your individual credit.
Being able to know whether you’re approved without sustaining a credit ding is a benefit.
You’ll need good to excellent credit. The issuer generally likes to see a minimum credit score of 680, BlockFi says. Those credit-approval decisions are made by the underwriting partner, Deserve Inc. The bank extending the line of credit is Evolve Bank & Trust.
Preapproval also will note your proposed credit limit and interest rate.
Dollar-cost averaging
If you use the card regularly to earn rewards, you will be regularly and passively buying crypto every month, regardless of their price, resulting in dollar-cost averaging. Some investors favor that strategy, as opposed to trying to time the market or making emotional buying decisions.
The downside is you have no control over when your crypto is bought because BlockFi does it automatically once a month, not in real time as you make a purchase with the card. The value of the cryptoasset could have gone up or down between the time you make a purchase with the card and when you’re granted crypto as a reward for that purchase. Some people will see that as a big negative about his card.
No annual or foreign transaction fees
It’s a low commitment to get the card because the annual fee is $0. If you find you don’t like it, you can stop using it with little downside.
And while traveling internationally — or buying online from a merchant in a different country — you won’t be charged a foreign transaction fee on purchases.
Drawbacks and considerations
Mediocre rewards rate
A primary alternative to the BlockFi Rewards Visa® Signature Credit Card is using any other card to earn rewards, then turning around and using that value to buy crypto. That way, you can buy on your own terms and timing. Either way, you could capitalize on the potential for appreciation.
A flat rewards rate of 1.5% on everything you buy is just OK. The second tier of rewards, with a 2% flat rate, starts only after spending $30,000 in a year, based on the card anniversary. That’s a threshold only big spenders will eclipse.
Instead, you could get an unlimited 2% flat-rate cash back card like the Wells Fargo Active Cash® Card. It has an annual fee of $0 and even comes with a sign-up bonus: Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months.
With the cash rewards from that card, you could buy cryptocurrency whenever you want at a crypto exchange of your choosing.
Or if you wanted rewards in a form that could be converted more easily into crypto, you could consider the PayPal Cashback Mastercard®, which offers an unlimited 2% back on everything you buy. PayPal lets you buy, sell and hold crypto from the account you already have. Sibling company Venmo has the Venmo Credit Card, which allows automatic purchase of cryptocurrency using cash-back rewards.
New Yorkers are out
At the time of this writing, residents of New York state aren't eligible to apply for the BlockFi Rewards Visa® Signature Credit Card.
The state of New York requires a particular license (BitLicense) that BlockFi doesn't have. That prevents New Yorkers from opening a BlockFi account and applying for its credit card.
Other states are currently wrangling with how to deal with crypto platforms. At the time of this writing, residents in Kentucky can get a BlockFi Rewards Visa® Signature Credit Card, but they will receive rewards in their "BlockFi Wallet," a new non-interest-bearing crypto wallet, a BlockFi representative said.
Taxes
It’s not related to a card feature, but just be aware that if you sell your crypto for a profit, you could owe capital gains taxes. That’s not true of cash back, points and airline miles earned with other rewards credit cards. Those rewards are considered a discount on the purchase price of things you buy with the card.
The BlockFi card account will have a record of transactions and track the cost basis for you, which you can use to help file tax returns. But BlockFi doesn't offer individual tax guidance.
No authorized users
At the time of this writing, the card doesn't support authorized users. Just a single card is issued per account.
"We are currently exploring this functionality for future versions of this card and will notify customers when it becomes available," a spokesperson said.
How to decide if it's right for you
If you want cash back, this card isn't for you. If you want to buy crypto on your own terms and timing, this card isn't for you.
But if you want an easy way to get into crypto with money you probably weren’t counting on anyway — credit card rewards — then the BlockFi Rewards Visa® Signature Credit Card is a fine way to do that.
Methodology
NerdWallet reviews credit cards with an eye toward both the quantitative and qualitative features of a card. Quantitative features are those that boil down to dollars and cents, such as fees, interest rates, rewards (including earning rates and redemption values) and the cash value of benefits and perks. Qualitative factors are those that affect how easy or difficult it is for a typical cardholder to get good value from the card. They include such things as the ease of application, simplicity of the rewards structure, the likelihood of using certain features, and whether a card is well-suited to everyday use or is best reserved for specific purchases. Our star ratings serve as a general gauge of how each card compares with others in its class, but star ratings are intended to be just one consideration when a consumer is choosing a credit card. Learn how NerdWallet rates credit cards.
