What is an Ethereum debit card?
An Ethereum debit card is a card connected to a cryptocurrency wallet or account that holds ether. These cards allow you to spend your coins on goods and services online and offline, as well as withdraw money on ATMs. When you make a payment with your debit card, the existing ether on your account is instantly converted (at the current market rate) to a corresponding fiat currency amount needed to complete the transaction. This is exactly like the process when your regular debit card makes payments in a different currency (such as dollars or euros).
There is a fundamental difference between an Ethereum ‘debit’ card and an Ethereum ‘prepaid’ card. With an Ethereum debit card you have an account with all the functions of a ‘normal’ bank account, and your card is connected to this account. With an Ethereum prepaid card you have a card onto which you can load money which you can then spend.
Ethereum debit cards are more than just regular debit cards. Instead, they operate more like Ethereum bank accounts, as they come incorporated with a feature that allows you to switch between ether and fiat currency within your account, removing the need for an exchange. This is a huge step towards cryptocurrency becoming more widely adopted in day to day life.
How do Ethereum cards work?
Ethereum debit cards work just as ‘normal’ cards. The card is connected to a cryptocurrency wallet or account, so when you make a purchase, the ether in your account balance is automatically converted to fiat currency (GBP, USD, EUR) at the current market rate. For example, if you were trying to buy a £15 pound football from a local store with your card, £15 pounds worth of ether (according to the current market rate) would be exchanged into fiat currency (GBP), which is received by the vendor.
So, it’s like having a currency account?
Correct. An Ethereum debit card works like a currency account and the only difference is that the account balance is in ether rather than fiat currency. You will also find card providers such as Wirex that issue cards that can hold both cryptocurrencies and regular fiat currency at the same time.
Are Ethereum debit cards accepted everywhere?
Yes, provided the merchant or ATM supports regular debit cards such as Visa or MasterCard, your ethereum debit card will work exactly the same as any other card.
What if I lose my card?
Don’t worry. The funds in your card are directly connected to your linked cryptocurrency wallet or account. You just have to call your card provider to let them know they should freeze or cancel your card, as well as order a new one (often you can do this all instantly within a mobile app). If you don’t want the hassle, you may opt to use a virtual Ethereum debit card, which would allow you to conduct online payments.
What’s all this about virtual cards?
An Ethereum debit card can come in two forms. These are:
Virtual. This is a card that you can use immediately upon registration, and which is stored virtually rather than as a plastic card. It carries the same details as a regular debit card, such as your full name, CVV code, expiry date, and card number, but you can only use it to carry out online transactions.
Chip + pin (plastic). As a physical version of the card, this effectively operates as a ‘normal’ debit card. You can use it at an ATM, as well as to make online and offline payments.
Are there fees for using an Ethereum debit card?
Yes, there are usually fees attached to using an Ethereum debit card. The fees you will be charged will be different depending on the card provider, but we’ve compiled a list of all the possible fees that you might incur:
- Card fee. This is usually a flat fee charged for the production of the card, ranging between £5 and £30. Sometimes, the cost of delivery is factored in, but providers could charge them separately.
- Monthly fee. Ranging between £1 and £5, this is the account management fee charged by some providers. Some providers offer the chance to pay fees annually rather than monthly, which works out cheaper over the course of a year.
- Loading fee. Most providers won’t charge you anything for loading funds into your wallet or cryptocurrency account, but some do charge a small fee up to 1% of the amount loaded. On top of that, you will usually be charged a negligible transaction fee (under £2) that goes toward rewarding miners on the blockchain for verifying your transaction, but this fee is completely separate from the card provider.
- Online purchases. Usually, there are no transaction fees when making online purchases, but in rare cases, you may come across Ethereum debit cards charging a small fee, typically less than £1.
- Retail/store purchases. The fees for retail/store purchases work exactly the same way as online purchases.
- Administration/support. If you wish to trace or recall a payment, your card provider will usually charge you a flat fee ranging between £20 and £30 pounds for the operation. While the spending of ether through your account is an anomalous operation, your card provider can help you trace transactions because at the point of sale, ether is transferred into fiat currency.
- Currency exchange rates. When carrying out the conversion of your ether to fiat currency for spending, card providers charge a premium above the normal exchange rate, which ranges between 0.7% and 5%.
- Delivery fee. As mentioned, the delivery fee usually goes hand in hand with the card fee, but some providers charge for delivery separately, requesting you to pay a flat fee of around £5 and £20. This could be higher if you require overseas shipping.
- Foreign transaction fee. Depending on your provider, you can expect to be charged anywhere from 2% to 5% extra if you use the card to pay for goods and services in a foreign currency.
- ATM fees (domestic / international). Using your Ethereum debit card at a local or domestic ATM usually comes with an additional charge between £2 to £3. If you use an ATM that works with a foreign currency, fees become higher, ranging between £3 and £5.
Are there card limits?
Yes. Depending on your card provider and the verification status of your account, you might incur limits to ways in which you can use your card. These are outlined below:
- Maximum / minimum balances. Most providers will require you to maintain a minimum balance between £1 and £10 worth of ether in your account at any particular time. However, there are others that will allow you to use all the funds in your account, down to the last penny’s worth.
When it comes to the maximum balance, this usually ranges between £150 and £1,000 worth of ether for unverified users, and £10,000 to an unlimited amount for those who are fully verified.
- Spend amount limits (per transaction). While there usually isn’t a spending limit for verified users, unverified users might have a spending limit of around £150 and £1,000 per transaction, depending on the provider.
- Load amount limits. Like spending limits, verified users often don’t have a load limit. However, unverified cardholders can only load up to £1,000 at any one time.
- ATM withdrawal limits. These limits also depend on your verification status. If you are verified, you can usually transact as much as £1,000 per transaction, and only up to £200 if you are unverified.
What verification steps are there?
To sign up and order an Ethereum debit card, you will only need to provide details such as your full name, email address, date of birth, and address. If you do not wish to provide additional information, your account status will be unverified and you will be subject to limits as set out in the above section.
In order to remove these limits, you must provide documentation that shows proof of identity (a government issued ID, a passport photo, or a driver’s license) and proof of residence (a bank statement or utility bill dated within the last 6 months). The choice is yours, depending on whether you prioritise anonymity or want to spend your ether on larger transactions.
Should I get an Ethereum debit card?
This depends on you. If you want the convenience of being able to spend your ether to conduct and transact on an everyday basis, an Ethereum debit card is the best way to do it. You can choose between options such as fully verifying your account or not, as well as the option of using a virtual or physical, plastic debit card.
How can I get an Ethereum debit card?
This is the easiest step. Have a look through our comparison table where we’ve compiled the top Ethereum card providers to find what might be the best option for you. Then, follow the link to sign up and start spending your ether!