Bitcoin rewards triggered shopping frenzy for cardholders: BlockFi data

Posted by Gerald Roberts on October 14, 2021 - 1:45am

Bitcoin (BTC) turned out to be a far more attractive prize than airline miles or other cashback rewards, new data from BlockFi suggests.

It’s been three months since the New York-based crypto loans startup launched its Visa-backed Bitcoin rewards credit cards, BlockFi Rewards Visa Signature Credit Cards, to customers. The card offers rewards in Bitcoin instead of using a more traditional points system.

According to the company, if the average Bitcoin rewards card owner continues the shopping habit seen in these first three months, they'll be on track to spend more than $30,000 per year on average. This is almost six times the average of $5,111 per cardholder in the United States.

“The fact that cardholders are pacing towards over 2 billion dollars in annualized spend reinforces BlockFi’s mission to provide clients with broader access to financial products and services that allow them to invest in cryptocurrency more easily,” BlockFi Co-founder and CEO Zac Prince told Cointelegraph.

BlockFi said its Bitcoin rewards card has grown past 50,000 owners across all 49 states, excluding New York, where the card is not available. California accounts for over 20% of total spending while Washington D.C., California, Texas and Florida follow as the highest spending states.

Cardholders have amassed more than 124 BTC in rewards collectively during the program’s first three months, with Costco, Amazon and Home Depot being the top three merchants. The spending behavior ranges from everyday purchases like groceries, utilities, and home improvement projects to more significant purchases.

“For the Bitcoin maximalist, Compass Mining has been a top merchant for those who want to earn even more bitcoin from their home mining rigs,” the announcement reads.

Available to use anywhere Visa is accepted, BlockFi’s card enables its owners to earn 1.5% back in the original cryptocurrency with an introductory 3.5% rate. Due to the price movements of Bitcoin, cardholders who were paid out rewards at their 3.5% intro rate made an effective rate of over 4.25%. Customers earning the standard 1.5% back were also getting a 1.8% effective rate, the BlockFi team explained for Cointelegraph.