As I lean deeper into living off of the internet, I have started looking for ways to have a reliable way to spend the money I earn in Crypto in the real world. I like the idea of spreading the word and showing the power of crypto without having to buy things with gift cards, or charging through a 24-72 hour wait time to pull my funds out. This is all made harder by the fact that I live in Canada, which means two things for me: 1) cryptocurrencies are not legal tender here in Canada and being so, are not affected by taxes as long as it is kept, and spent in crypto currency. 2) This means that any companies going through Visa, Mastercard, etc. cannot get their cryptocurrency visa cards approved here just yet.
So this leaves us with the problems of getting my money out for everyday spending at all, and how to keep my money from crypto easily separate from my normal bank account, to make sure that everything is structured properly come tax time. having my criteria, I went to work.
I will save you all the monotonous details of researching through different articles saying how so many companies had plans to bring a card out to Canada, or in one or two case they may actually have, before they were shut down? At any rate, a few solid hours, a handful of online chats with different companies, and I finally came to the conclusion that there was no crypto-ready vis cards in Canada just yet....on to the next option.
Ultimately, I came up with this scheme to keep everything as organized as possible in one go (I recommend reading this over first before starting to make sure you set up all the necessary accounts for your situation)
First off: I personally keep all my everyday spending money in investments or activities that can pay me in Bitcoin, or widely accepted altcoin. (I will detail my strategies for personal savings vs personal spending in another article). This ensures easy access to funds by depositing everything into a "bucket account" that collects payments from various sources.
BUCKET ACCOUNT CHOICE - NETCOINS (For Canada)
Netcoins is a platform that focuses on Providing cryptocurrency access to Canadians in a "step or two past basic" way. They make it easy to money with e-transfers, with money arriving within 30 mins. This means when we are transferring fiat currency into crypto, or pulling our funds out to spend, Both are done with e-transfer. The only down side to this convenience is that they are available for transfer into and out of your account during business hours. So we do have to plan our weekend withdrawals. Hey, still better than anything else I have found! =)
They work with BTC, BCH, ETH, LTC, XRP & CAD funds, which makes them fairly ideal for common altcoin, but can make it require one more account "upstream" in any one of your preferred exchanges (I personally like crypto.com, But thats a different article). The goal here of course, is to require as few transactions as possible from any income source wallets, to your "bucket account" to save on fees where we can. Once we have all of our funds transferred to Netcoins, we will exchange them for CAD funds leave them there until a bit later.
SETTING UP A SECONDARY BANK ACCOUNT (online) - KOHO FINANCIAL
Next link in the chain (and last... short chain is what we want I promise!) is to set up a service to send our funds from Netcoins, which are now sitting in CAD, waiting for us, into a way we can spend it in the real world, and ideal without a surcharge to avoid ever more present fees if we don't watch out for them! This is where virtual or online banks come in handy.
Covid notwithstanding, I don't want to wait in line for a bank anymore if I have the convenience of chatting and setting up my basic day to day spending and saving with an online banking platform. This way, it is kept separate from my traditional bank account should any odd taxation scenarios arise, as well as hygiene in our evolving world. For this, I chose KOHO. They have a decent referral reward system, of 1% rebate for 90 days on everything you spend with them, up to a loaded 10%!
Now I'm not sure what the taxes are like in other parts of the world, but here in my part of Canada, we pay 12% for our taxes. That means that if you refer anyone into this free service, you could be saving almost the entire tax rate for everything you purchase! Not enough? How about their upgraded membership? 89$ a year (still cheaper than the average bank fee by their claim) and you get another 2% off... thats right, 12% off every purchase, essentially shopping with your taxes paid for.
What I also love about KOHO is that they have a virtual card system as well as a physical one. This means I can set up my virtual card to be spent online right away (online grocery shopping, with 12% savings!) and if you have Apple or Samsung pay, you are only limited to pulling cash out at ATMs, and paying for things below the tap limit until your card arrives in the mail about 2 weeks later.
PUTTING TWO PIECES TOGETHER - Simple Transfers
Just to wrap everything up with a nice bow, Let's put everything together at the end here. I find its easiest to do this set up using a computer to operate Netcoins, and a smartphone to operate KOHO.
Now that we have our CAD funds sitting in our Netcoins account, and a place for them to be sent, we will has for a withdrawal. We are going to go to KOHO and add our funds. It will pop up with an email to send e-transfers to. Take this email and paste it into your Withdrawal form on Netcoins... And we our good to go!
Now all we have to do is wait somewhere between 1-30 minutes ,and we are officially ready to use our crypto and other online income for our daily, and weekly expenses!
If you want to read my thoughts towards alternatives platforms for a similar purpose in other countries, look out for a coming article, "Bankless In the Modern Day"
If You have any questions on this set up, please feel free to leave a comment down below! =) I am happy to help anyone set up a similar structure for themselves where ever they are in the world!
Very interesting article