Is it worth it to withdraw money and make purchases with a Binance card, and if so, how much does it cost? Some of the fees are hidden and fluctuate strongly, as do the exchange rates, so be on the lookout for someone who calculates them. During five transactions in December, roughly two percent costs were incurred on average, and some minimal income came in from “cashback” refunds.
After gaining the first experience of his life with a crypto card cash withdrawal – we reported on this here – Mr. Kovács saw the time to use the plastic card for shopping before Christmas. But he always only paid amounts strictly under twenty thousand forints with it, so that he might take advantage of the 2022 tax relief for these amounts.
The good news is that it worked smoothly, it was not rejected anywhere, there were no major problems. It is a minor inconvenience that they asked for the pin code of the card every single time. The no-touch, simple method never worked, but probably because of an amount limit rule. THE It can be downloaded from Binance software An Excel statement does not contain all the information, for example HUF amounts and deductions. (If you want to archive all the information, you should also take screenshots.)
Binance and VISA lead the way
The other big question is what it costs us. We have already calculated once how much automatic (ATM) cash withdrawals cost:
A We spent 19,674.62 forints of hard cryptocurrency on 19,000 forints of crisp banknotes, calculated at the current market rates… That’s 3.55 percent more, isn’t it? a percentage “surcharge”… Or the other way arounda, We received HUF 3.43 percent less for our cryptocurrencies than would have been possible at the maximum exchange rates.
Which is all the more logical, because neither the card issuer Binance nor the VISA card provider wants to work for free. In Binance’s regulations, it is unchanged that you can buy and withdraw cash at a fee of 0.9 percent (This is shown in practice through their cryptocurrency purchase rates.) But the other player also earns some through the EUR/HUF exchange rate.
Do the exchange rates fluctuate a lot?
However, even with three store purchases and an additional automatic cash withdrawal, it was not possible to reproduce the first case, the 3.4 percent deduction mentioned above did not work out. As can be seen in the table, quite different values came out between calculating the HUF value of the deducted cryptocurrency at the world market price and mid-exchange rate, and between the amount we received ready-made.
We received a variable value compared to the market rate valid at the time of purchase. This is possible if there is some kind of slippage in settlement – one of the applied exchange rates follows the market one with a delay. Probably for bitcoin, as it is not uncommon there for the exchange rate to move by a few percent even within minutes. But the forint is not a model of stability either, it also fluctuates. It is also conceivable that service providers flexibly change their profit margins, for example depending on volatility or the difference between working days and weekends.
That freaking liquidity
So here, too, what we hear so often is echoed, that the value of cryptocurrencies changes very hectically, their volatility is high. However, you can protect yourself once morest this if you want, since BUSD or USDT stablecoins can also be used as card collateral. (In the Binance desktop application, on the card sub-page on the right, you can set which crypto to withdraw from first, and you can transfer to the “funding” card cover account, which we would use for this.)
By the way, at the end of the year, at the beginning of this year, the liquidity of the cryptocurrency market decreased a lot, but as one analyst company also said, strong price movements followed such periods in the past:
See: This bitcoin price is already a bigger stormSheedge?
Cashback and cashback promotion
As we discussed in a previous article, most crypto card providers offer cashback following card purchases. In other words, the card service provider returns part of the value of our card spending, and some of the commission it receives from merchants trickles back. The value of the cashback at Binance depends on how many BNB tokens we hold. See:
That’s why the crypto card is good – I pay for its use, or the merchant paysShek?
Binance does the same, but by default there too – if you don’t buy a lot of BNB coins – you don’t get too much cashback. In our case, this was zero BNB, so specifically only regarding 13 euro cents (HUF 50) were credited for the above three transactions, which may have been one thousandth of the purchases.
Binance Card offers between 0.1 percent and 8 percent cash back on card purchases.
At the same time, there was an “action” in December, Binance announced that it would give a six percent reward in BUSD (Binance dollars), “extra cashback” following card purchases. I was lucky to catch this.
Lessons learned from the five Binance cardings
It’s a shame that 2.8 dollars is not always enough for a kilo of good bread in Hungary these days… Overall, the cashback is an insignificant, symbolic amount without a BNB connection. For this reason, it doesn’t matter whether you withdraw cash with your card and spend it, or use the card to make purchases directly in the store. (But at least cash can’t be tracked, unlike digital transactions.)
And if you first sell your cryptocurrency to be spent on the stock exchange, then transfer the money to a bank account and spend it that way, you still have to take into account several cost items. However, for larger sums of money, the latter is probably the cheaper solution.
This is good for tax relief
As we know, from a tax point of view, there is no difference whether you buy or withdraw money from the machine, in principle both are taxed at 15 percent. However, due to the tax relief, card playing with amounts below one-tenth of the minimum wage can still be recommended to taxpayers in Hungary. (A maximum of ten of these are tax-free in a year, this year up to HUF 23,000 each.)
Ha You would order a Binance card, it may take several weeks to arrive. The company is a maximum of 45 days old mentions a deadline.
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Cover image source: Binance.com
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