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Would you recommend the Monaco card for cryptocurrency users? How does it compare to existing bitcoin/altcoin cards? Does it have any special benefits?
Hi there,
Monaco cards are issued by Monaco Technology GmbH. This startup is registered in Zug, although it primarily operates out of Hong Kong. Monaco cards are not yet issued in Switzerland, although the company is taking reservations via its Monaco app. The cards will initially be offered in Singapore.
Monaco cards run on the Visa payment network and are denominated by the MCO token, an Ethereum-based cryptocurrency created by Monaco. MCO can be purchased on a number of cryptocurrency exchanges. When you use your card to make a payment at a POS terminal or withdraw money at an ATM, the corresponding amount of MCO is converted to fiat currency (Swiss francs, for example).
Disadvantage: In order to be elligible for high-end Monaco cards, you must purchase and hold certain amounts of MCO.
The absence of most fees is the biggest draw for these cards. The cards have no annual fees and Monaco claims that it does not charge currency exchange spreads. Other fees charged by most credit and debit cards, like cash withdrawal fees, do not apply as long as you stay within fair usage limits (the fair usage limits for Swiss customers are not currently known).
Monaco earns revenues off interchange fees, like credit card issuers do. Whether this model can be applied in Switzerland, which has relatively low interchange fees, is yet to be seen.
Interesting innovations include cash back of between 0% to 2% depending on the card used (cash back is credited in MCO), and complimentary travel insurance (on higher-end cards). These benefits are not typically found on prepaid cards, which is effectively what the Monaco cards are.
The biggest difference between Monaco cards and other cryptocurrency debit cards is that Monaco uses its own cryptocurrency rather than widely-used cryptocurrencies like bitcoin, Ethereum or Dash to denominate accounts and transactions.
This is beneficial in that the company can reward cardholders with generous cashback, but is also a drawback because card users must purchase a cryptocurrency which has relatively little value outside of the Monaco card user circle.
Best regards from Moneyguru
More on this topic:
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Using no-annual-fee credit cards
Buying and using bitcoin in Switzerland
