Can you believe that cryptocurrency has been around for over a decade now? In all fairness, it spent over half a decade languishing in obscurity, but nothing is languishing or obscure about crypto these days. As of now, there are over 100 million people around the world trading digital currency, and the trend is only expected to strengthen over the next few years.
With the rise in popularity of cryptocurrency, one problem that’s risen is the difficulty of using cryptocurrency in real-world applications. The good news is that over time, different developers have created programs that make it easier to spend bitcoins as you would fiat currency. Continue reading to learn how to use your crypto assets in the real world as well as a new development on the way.
Crypto vs Fiat
When Bitcoin launched over a decade ago, it was introduced as a new and easier way to handle international transactions. The thing about Bitcoin that separated it from other currencies is that it was the first currency not to be backed by a government or fiat, merely blockchain technology and the will of the people. However, being that cryptocurrency is a completely digital form of tender, it couldn’t be spent anywhere but online and could only be used with people and merchants who accepted bitcoins.
Traders can convert bitcoins to cash, but the process can take days as well as be rather costly. Because of the meteoric rise of crypto assets, there’s now a greater need than ever to make it simple for people to convert or spend their crypto.
If you want to use your local currency to purchase digital assets, the best way to do so is on a crypto exchange platform like Coinbase or Binance. Coinbase is the largest exchange platform in the U.S. by trade volume and Binance is the largest in the world. The sheer trading volume of these platforms means they offer you the best chance at maximizing your cryptocurrency.
Crypto exchanges allow you to purchase digital assets using fiat currency or convert your crypto assets into your local currency. You can even trade one cryptocurrency for another. Some crypto exchanges even allow you to borrow real-world money using your crypto assets as collateral, which we will cover in the next section.
Crypto Credit Cards
Being that people have been using their cryptocurrency more like holdings or other assets than as currency, it only makes sense that digital currency can now serve as collateral for loans. Crypto credit cards allow people to access the funds from their loan the way they would a regular credit card. However, the main difference is that a cryptocurrency credit card is backed by collateral.
The good news about using your virtual currency to back a loan is that you don’t have to worry about your credit score. However, if you fail to repay the loan, you’ll lose the crypto assets you put up as backing.
Crypto Debit Cards
One of the most exciting developments for crypto traders was the introduction of crypto debit cards. These debit cards can be used anywhere Visa and Mastercard are accepted, and they work much the same way prepaid debit cards do.
For instance, cardholders have to pay ATM and transaction fees, but this card makes it easier than ever to spend your cryptocurrency when buying from real-world merchants. One important thing of note is that you have to pay close attention to your debit cards, as your available funds will fluctuate with the value of your cryptocurrency, even within a day sometimes.
As you can see, there are now more ways than ever to use or convert your cryptocurrency. There are even some new crypto credit cards arriving in 2021 that work the same as regular credit cards except for they offer crypto as cashback rewards. Right now is a great time to be a crypto trader.