Coinbase and Cardless have a co-brand American Express card that earns ‘up to’ 4% cash back. That’s based on your assets held at CoinBase, not specific categories of spend.
To earn 2.5% or higher you need at least $10,000 in assets on deposit with Coinbase. For most this is a 2% cash back card with forced conversion to crypto with a $50 annual fee. You’d be better off with a Citi Double Cash card and spending your rebates on whatever you wish (including crypto or something else).
If you are already a Coinbase customer, with big crypto balances, you can get value out of this card but note that rewards above 2% are capped.
- 2.0% BTC back if “Assets on Coinbase” < $10,000.
- 2.5% BTC back if assets $10,000–$49,999.99 — only on the first $10,000 in purchases each calendar month; all additional monthly spend earns 2.0%.
- 3.0% BTC back if assets $50,000–$199,999.99 — cap applies to first $10,000/month; above that 2.0%.
- 4.0% BTC back if AOC ≥ $200,000 — cap applies to first $10,000/month; above that 2.0%.
For the first 60 days after account opening, assets are calculated based on real-time value at purchase, then after that they take the 30-day average of end-of-day asset value. Average assets on the date of each purchase sets the rebate tier for that purchase.
An active, paid Coinbase One membership is required to open and keep the card and to earn rewards. If membership cancels, the card may be closed. Basic membership is $4.99 per month or $49.99 per year and you need an annual plan to qualify for the card. (There are also $29.99 and $299.99 monthly premium plans.)
What I found interesting about this is the business case or vision behind the product, based on a recent online discussion.
- For Coinbase, they get demand and distribution
- For Cardless as program manager demonstrates speed to market, instant wallet provisioning and a premium halo and runs a scaled, high-engagement cobrand.
- For American Express they get forward branding and offers in crypto. They get a crypto customer base they don’t normally reach.
The card isn’t just paying out rebates, it’s keeping the money on the Coinbase platform. They’re pushing a loop: spend → earn BTC → borrow USDC against BTC → trade/stake/earn in-app. That’s lifetime-value engineering: interchange + lending spread + trading spread + staking margin, not just rewards. As a result, “up to 4% back” is the hook, not just the cost center.
They’re generating revenue from:
- Coinbase One subscription
- Interchange share on Amex plus Amex Offers subsidies.
- Cross-sell margins (borrowing, trading, staking).
They can easily afford capped higher-tier earn rates when cardholders use the rest of the Coinbase stack. And they’re targeting two cohorts with different unit economics:
- Crypto-native: already holding, staking, trading, borrowing — that’s the highest lifetime value. The card cements “top-of-wallet” and locks assets on Coinbase (they highlighted USDC 4% earn, staking “up to 17%,” derivatives access).
- Crypto-curious: the card serves as a no-cash-in onramp to a BTC position. This gets new customers, with customer acquisition cost for Coinbase’s brokerage amortized through card usage.
American Express says they’re going “deep and broad” with Coinbase and name-drops a separate “Passport” benefit tied to the Coinbase family. So this isn’t seen as a one-off. Expect more Coinbase features and benefits across other products in the future. Perhaps it’s part of their merchant-funded offers funnel.
I’m somehwat skeptical of the claim, though, that “two-thirds of millennials have ~ one-third of their investments in crypto.” And you can’t really expect “up to 17% staking” and “4% USDC earn” stacked as rewards from the product.
- If it was, you could stack 2% cash back with 2024 total S&P 500 return of 24.82% based on an assumption that you invest the cash back in SPDR S&P 500 ETF Trust. (If this was a reasonable way to estimate return, the Citi Double Cash would massively beat the Coinbase card.)
- In any case, extra-normal returns are not free. They generally have downside risk. S&P had a great year, but stocks also have down years. That’s in some sense why you earn higher returns on average than bonds or cash (the ‘equity risk premium’).
- It is possible in some cases that there are market inefficiencies that can be arbitraged for higher rates of return. James Simons outperformed everyone for long periods of time with the Renaissance Technologies Medallion Fund. But even that didn’t scale. And the public couldn’t invest.
On the one hand I ultimately don’t want to bundle a concentrated asset allocation decision with my card rewards. On the other hand, if you’re earning a proprietary currency like Chase Ultimate Rewards or American Express Membership Rewards you’re already doing that (single currency earn). I like those compared to a single airline’s miles, since you can transfer to a variety of other currencies. You rarely see devaluation of transfer ratios, although devaluations of the underlying transfer partners is common. And of course, you can sell your bitcoin!
“Beware of Greeks bearing gifts…” Your skepticism is indeed warranted, Gary. Two major red-flags: Cardless and crypto. Some would refer to the ‘revenue-generating loop’ as a mere circle-jerk, which might feel good to a few of you, but when that ‘house of cards’ falls down, enjoy the clean-up. I’d avoid this like the plague (you know, plagues, like, the pandemic we all just lived through.) Like, friends, have some self-respect and stick to Citi’s DoubleCash, or even Fidelity Rewards 2% no-fee card, or ‘go big’ with BofA Premium/Unlimited with the Platinum Honors bonus (2.625%).
Thanks for the explanation. We have to watch out for Trojans.
I have no experience with crypto (and not particularly looking to have any) but I’m not sure how this is much different than a regular rewards credit card charging an annual fee that is “sharing” with its customers a % of spending. Here the sharing is not points, not cash, but BTC.
Cash is king! Cash can be deployed as you see fit (and agree- if you do not have 10k in assets with them, why pay $50 to get 2% when you can pay $0 to get 2%).
BTC has a value that fluctuates, but could be an investment that increases in value over time. BTC is up 71% YoY and 735% in the past 5 years. Sure looks like a house of cards to me, but certainly represents real value to others.
Many, including the younger generation that may be priced out of buying a house, take a look at the S&P up 16% YoY and 107% in the past 5 years, then take a look at BTC, and think to themselves that maybe if they can do ~4.5-7x better on their investments that might be a good thing.
The experts that “know what points are worth” will tell you that points have a value greater than 1.0cpp, but points generally have a 1.0cpp cash out value (other than those pesky CSR points that stick around at 1.5cpp through October 2027). Anything above that requires a redemption opportunity with an airline or hotel program, and those redemption opportunities are getting more expensive every day. So points might have outsized value when deployed for certain uses with tickets that often have limited availability (buying a $5k business class ticket for 60k points and getting 8.3cpp is a very attractive return) but, in general, they depreciate in value at values more than 1.0cpp. For most redemption transactions, most people end up redeeming their points for between 1.0-2.0cpp (and I’ll bet that it is at the low end of that range).
Anyway, as far as banking goes, this offer doesn’t seem crazy other than the fact that it’s Cardless and Crypto (@1990 – what’s a red flag anyway these days?). If you have 10k in crypto with them, you can get 2.5% BTC back up to $10k/mo, and then just sell the BTC and convert into cash. And 10k is a much more achievable amount for folks that don’t have 100k with BofA/Merrill for the 2.625% cash back.
@Peter — Well said. Also…
Red flag, shmed flag!
Line goes up!
All gas, no breaks!
1929 never happened!
FOMO!
As someone who got burned by Celsius, the issue here is, do you trust Coinbase to hold $200,000 to get the 4%? Coinbase has the best track record, but as they say, “Not Your Keys, Not Your Coins”. If they were to get hacked, they owe you nothing. The 2% is fine, but for an extra 2%, I wouldn’t risk $200k. Could also just do a normal fee free 2% card, and use the cashback to buy crypto.
@Mike gets it.