Mastercard and Nexo have announced collaboration to bring out the first ever “Crypto-Backed” Payment Card in the world.
According to a report, Nexo, which provide credit services for purchase and sale of Crypto assets including cryptocurrencies, digital assets, NFTs etc. has informed that in its budding stage, the credit card will be issued in some selected European countries only.
Generally, the credit cards come with a predefined credit limit for a month. Since in the case of Crypto -Backed cards, the digital assets would be used as collateral to back the credit, therefore, the limit would be set according to the market value of digital assets in one’s possession. To combat volatility, 90% of the total value of Crypto Assets in the wallet will be treated as the credit limit for a month.
This will give the users manifold advantages:
They will not be required to sell their assets like Bitcoins.
The card can be used at 92 million shops worldwide where Mastercard as a payment option is accepted.
As a cherry on the cake, there are no minimum monthly bills to be paid. Moreover, there are no FX fees for up to 20,000 euros per month. It is also free of any monthly, yearly or inactive account charges.
Further, there are no spending or withdrawal limits. Interest is charged only if loan-to-value ratio exceeds 20%.
The users of the card will also be rewarded up to 0.5% in BTC or 2% in Nexo crypto rewards on every purchase.
As the Nexo Card allows its users to spend without selling their crypto, therefore customer also save a big deal on taxes paid in case of conversion to fiat currency.
In brief, the Nexo Card is an extension of NEXO’s Instant Crypto Credit Lines that enables the users to continue day to day shopping without having to sell their valuable crypto rather just using it as security for repayment.
It is interesting to note that on one side where the regulatory authorities are trying their best to contain people’s involvement in the crypto world, the private players of the market are making all efforts to ease and multiple the usage of cryptocurrency for a common man. This is a clear indicator towards the widening interest of people in digital assets and currencies.
