Visa teams up with start-up for bitcoin rewards card

LOS ANGELES • The mainstream adoption of bitcoin is getting a boost from credit card giant Visa, which joined start-up Fold to offer a card that earns rewards denominated in the cryptocurrency instead of airline miles or cash.

As much as 10 per cent of cash purchases made with the co-branded debit card from San Francisco-based Fold and Visa will be credited to users in bitcoin, Fold chief executive Will Reeves said. He expects it can bring a wave of consumers to the world's most valuable digital asset.

"People are not interested in spending bitcoin right now, but are interested in accumulating it," Mr Reeves said in an interview. "If people don't understand bitcoin as money yet, they certainly will understand it as a better reward."

Visa's approach to crypto has been evolving. Just two years ago, it was in a public fight with the Coinbase exchange over issues related to purchases made using its cards.

Then, in February, Coinbase and Visa announced the Coinbase Card, which allows users to spend bitcoin using the Visa debit card.

The firms announced the Fold partnership last Thursday, and Mr Reeves said cards are expected to be issued in July. He declined to name the banks backing the card.

Bitcoin is a challenging technology for retail users, who must establish an account on an exchange and set up a virtual wallet.

Mr Reeves said his firm is working to make the process simpler.

Fold users also have the option to spend bitcoin within the firm's system to buy US dollar-denominated gift cards at companies including Starbucks or Uber, he added.

Placing bitcoin rewards next to familiar incentives such as airline miles, loyalty points or cash shows a maturity in how people are viewing cryptocurrencies, Mr Reeves said.

Bitcoin "enters the pantheon where it's that much closer to everyday consumers", he said. "I fundamentally believe there are more shoppers than speculators."

Visa said the Fold partnership is part of its Fast Track programme, which encourages fintechs to work with the card giant.

BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on April 13, 2020, with the headline 'Visa teams up with start-up for bitcoin rewards card'. Print Edition | Subscribe