@sammydavidjr wrote:
@Brian_Earl_Spilner wrote:Sooo...what happens when all the bitcoins are mined?
BlockFi doesn't mine Bitcoin, they just buy it and give to people as cashback.
What I find insane about this credit card is the $200 annual fee. Unless there are unannounced perks, it makes a lot more sense to use a 2% cashback card with no annual fee (Paypal, Fidelity, etc.) and buy Bitcoin with the cashback than to use this BlockFi product.
There's still a finite amount and they would rely on there being enough sellers to provide the rewards. If there's nobody selling, there's no rewards to buy and give out. Once it's all been mined, what happens then? The rewards structure is at the mercy of those holding the coins.
@Brian_Earl_Spilner wrote:
@sammydavidjr wrote:
@Brian_Earl_Spilner wrote:Sooo...what happens when all the bitcoins are mined?
BlockFi doesn't mine Bitcoin, they just buy it and give to people as cashback.
What I find insane about this credit card is the $200 annual fee. Unless there are unannounced perks, it makes a lot more sense to use a 2% cashback card with no annual fee (Paypal, Fidelity, etc.) and buy Bitcoin with the cashback than to use this BlockFi product.
There's still a finite amount and they would rely on there being enough sellers to provide the rewards. If there's nobody selling, there's no rewards to buy and give out. Once it's all been mined, what happens then? The rewards structure is at the mercy of those holding the coins.
People routinely sell Bitcoin that they haven't mined (most of Bitcoin that is traded every day is not mined by the ones trading it). When there is none left to mine the value of Bitcoin might go up, but BlockFi won't care: they will simply buy as much as they can buy for the USD equivalent of your 1.5% cashback. The cashback is in USD and converted to Bitcoin -- BlockFi are not committing to a minimum amount of Bitcoin.
It's not like banks that give fiat cashback need the Fed to print more dollars every time that they pay out cashback.
There are numerous products, not just credit cards but in every industry, where you could do extra work or planning yourself and come out ahead of using that product. One example that comes to mind is, I have a motorcycle. I have an insurance policy on it. However, I could instead simply either fix the motorcycle from savings, or let it stay broken until I can afford to fix it. In my case, it's a pleasure vehicle that I do not rely on for work etc. Knowing that insurance companies normally take in more revenue than they pay out, and thus that I am likely to pay more on premiums than I recoup in repair costs, why do I have this policy? Just to make life a little easier.
Unless this card has major perks aside from the 1.5% bitcoin thing, I do not think a $200 annual fee, or any annual fee, is warranted. But otherwise, I can definitely see the appeal of using this card, instead of taking the other steps involved to invest 2% cash back in bitcoin.
@Anonymous wrote:
Btc is at 19k... not going to 0...
It could, however, but more likely can plummet as it frequently does. There have been numerous huge losses in value just in the past few years, and it's been at $20k in the past only to lose 80% of its value in a heartbeat.
While BTC may possibly be a good long term investment, the question posed by others in this thread is still a very good one: why would one pay a large annual fee to earn 1.5% in rewards posted as BTC, rather than getting a no-AF 2% or higher card and then just purchase BTC?
