Editor’s take: Venmo has introduced a new way for its credit card holders to purchase cryptocurrency on its platform. Of course, there are far less riskier ways to obtain cryptocurrency that don’t involve opening a credit card. Heck, Venmo will sell it to you outright, although you can’t yet take it off the platform.
The program is called Cash Back to Crypto, and as the name suggests, it allows card holders to automatically purchase cryptocurrency using the cash back earned from purchases made with their credit card.
Starting today, cardholders will be able to activate the auto-buying feature and can change their crypto of choice at any time. Venmo said a cryptocurrency conversion spread is built into each monthly transaction, but added that the feature “will not have any transaction fee associated with the purchase.”
Venmo is billing the feature as a new way for customers to start exploring the world of crypto, and it might not be a bad introduction. According to a recent study from PYMNTS and BitPay, three out of four US consumers cited a lack of knowledge about cryptocurrency, including not knowing how to obtain them, as a reason for never having purchased any.
Speaking of, Venmo rolled out the ability for users to buy, hold and sell four types of cryptocurrencies on its platform back in April: Bitcoin, Litecoin, Ethereum and Bitcoin Cash. Parent company PayPal did the same back in November, and just last month, increased the weekly purchase limit and removed its annual buying cap.
Venmo’s credit card generates cash back in eight different spending categories. Users earn up to three percent back on their top eligible spend category, two percent back on the second highest category and one percent back on all other purchase.