The official announcement was made a few days ago: Nexo has launched a crypto card on the Mastercard network with dual mode, i.e. both credit and debit functionality.
It is the first dual-mode crypto card and allows payments in fiat currency on the Mastercard network using cryptocurrencies.
Summary
The Nexo Card: the first dual-mode crypto card with Mastercard
For now, the Nexo dual-mode card is only available to citizens and residents of the European Economic Area (EEA), but its use may be extended to others in the future.Â
During the early access phase, 11,000 activations have already been officially declared.
Of course, you have to go through the identity verification process to get it, and it can only be activated on personal Nexo accounts.
The company said that dual mode debit/credit lowers the barrier to entry for cryptocurrency adoption and helps users convert digital assets into fiat currency before using them to make payments.Â
Dual mode has been more than six months in the making and is the result of an explicit request from the community to add debit card functionality to the Nexo credit card.
Currently, when used in debit mode, the Nexo Card allows users to spend stablecoins in EUR, USD and GBP. Conversely, when used in credit mode, it allows almost any cryptocurrency supported by Nexo to be used as collateral.
The card has no exchange fees up to €20,000 per month and has an ATM withdrawal limit of €10,000 per month.
The Nexo Platform
Nexo offers up to 9% interest on cryptocurrencies deposited as collateral for debit card fees, and the Nexo Card offers 2% cash back in cryptocurrencies when used in credit mode.
The service offered by the company is precisely that of allowing the purchase of cryptocurrencies to earn interest income.
It allows the purchase of over 60 digital assets via card or instant bank transfer, and to earn daily interest on USDT, USDC, BTC and other digital assets.
However, it is a custody service, similar in some ways to Celsius and BlockFi, so be careful as it may not be easy to get your funds back if it shuts down.
The company was founded in Bulgaria in 2018, and has grown to manage assets for more than 6 million users in 200 jurisdictions.
In September last year, it was sued in eight US states and was subsequently forced to pay a $45m fine to the SEC.Â
The crypto cards
Crypto cards are used to make fiat currency payments on traditional payment networks, such as Mastercard or Visa, using cryptocurrency.
In a nutshell, you deposit crypto into the accounts of the card operator and when a payment is made, a certain amount of cryptocurrency held in the account is converted into fiat currency so that the payment can be made in fiat currency.
They are very useful because they effectively allow cryptocurrencies to be used almost anywhere to make almost any kind of payment.
However, they do have limitations.
The main one is certainly the loss of anonymity, since cryptocurrencies are born anonymous, but fiat currency payment cards are not.
There are also usage limits, of course, but these apply to all credit and debit cards, not just those that are powered by cryptocurrencies.
Finally, remember that exchange rates are not always cheap, as spreads are often applied. There may also be exchange or usage fees.
Furthermore, the instant conversion from crypto to fiat currency is done at the current price, whereas if you were to sell crypto independently, you could choose the time of sale and therefore the current price at which to do so.
However, they are very convenient, especially for those who have cryptocurrencies to spend, such as stablecoins, whose exchange rate tends to fluctuate little, net of any spread.
There are many crypto services that offer this way of using cryptocurrencies, so much so that many holders now have more than one.
