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November 25, 2023
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Should You Apply For A New Credit Card For Bitcoin Transactions?

Most people have got attracted to the latest sensation in the finance market- cryptocurrency. These are digital currencies with fluctuating values depending on the market trends. Many companies like Tesla have started accepting cryptos like bitcoins as a mode of transaction. Since these currencies are not completely under government laws, many countries have decided to move against them. Still, many people prefer to make transactions with bitcoins nowadays.

To own bitcoins, people need to purchase them. Several websites allow access to bitcoins by making a deposit. People make payments using cash, net banking, debit card, and even credit card. There are several perks and cons associated with credit card payments for buying bitcoins. Still, people prefer to use them because they can see the profit even after paying all the fees and taking all the risks.

Some people even prefer to apply for a new credit card dedicated to only bitcoin purchases. Let us discuss whether such a step is necessary or not.

Bitcoins are similar to shares

Bitcoins are similar to shares in the sense that their value fluctuates. You might not make much profit by buying a share. However, the profit multiplies to a surmountable amount when you obtain it from several shares. Similarly, bitcoin values can also gain you a lot of profit. However, if the value takes a dip, it might spell doom for you.

If you have a credit card with a considerable credit limit, you can use it to purchase bitcoins. However, if you plan to apply for a new credit card to purchase bitcoin, it will be a daunting step. It is risky to invest too much money in bitcoins, and you need to do extensive research before making such an investment.

New credit cards do not offer additional offers for bitcoins

Most credit cards come with a whole set of benefits. However, there is no dedicated benefit for buying bitcoins to date. The new credit card you plan to use for your bitcoin purchase will provide you the same benefits as any other credit card.

However, it will help if you analyze all new bonuses and offers carefully. Even if they are not directed for bitcoins, you can use your bitcoin purchase to strike a fortune out of it. Another point to keep in mind is about introductory bonuses. These bonuses are associated with many ‘first purchases.’ However, many credit card companies consider bitcoins as cash advance transactions. They do not allow such introductory bonuses for bitcoin transactions.

Keep credit utilization ratio in mind

Although you have decided to use your new credit card for buying bitcoins, you need to consider your credit utilization ratio. This parameter is important in predicting your credit score. You must maintain a healthy score if you want to apply for more credit cards in the future. Also, you can ask for a raise in your credit limit later on based on your credit score.

Keeping all these parameters in mind, you must decide whether you wish to apply for a new credit card. Be wise while you buy crypto with credit card.

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