In an increasingly crowded field — with exchanges, apps and banks fighting for a slice of the crypto pie — a new sector is also emerging to offer crypto trading. Buy Now Pay Later (BNPL) platforms are entering the fray, in what appears to be an effort to become a one-stop shop for personal finance services.
BNPL is a type of deferred payment option that generally allows the consumer to split a purchase into smaller installments, typically four or less, often with a down payment of 25% due at checkout, according to the Consumer Financial Protection Bureau (CFPB).
Buying Bitcoin with Affirm
Recently, San Francisco-based BNPL company Affirm launched its Affirm Crypto program, which enables customers to buy and sell bitcoin without any fees or minimums.
Affirm has partnered with NYDIG to process Affirm Crypto Bitcoin transactions and to provide crypto accounts more broadly, according to its website. In addition, the program enables customers to set up automatic conversions of monthly Affirm Savings interest into bitcoin. Customers can either purchase bitcoin directly through the app, or have the monthly interest earned from their Affirm Savings account converted automatically to bitcoin.
There is one caveat, however, as the program is only available to Affirm Savings account holders who have successfully linked a bank account, and participation is through invitation only — users which are “randomly selected among Affirm Savings account holders.” “At this time there is no waitlist to join the program,” according to the website.
“Crypto, the current volatility notwithstanding, has been one of the best-appreciating asset classes,” CEO Max Levchin told Bloomberg in January. “For most rank-and-file Americans, I think it’s still pretty difficult to enter this ecosystem.”
Buying Bitcoin with Afterpay
Jack Dorsey’s Block (ex-Square) also bought BNPL giant Afterpay in August 2021 for $29 billion, according to a press release. Afterpay consumers will receive the benefits of Cash App’s financial tools, including money transfer, stock and bitcoin purchases, according to the release.
During an investor call on May 5, following earnings releases, Dorsey said that “we’re really excited about Afterpay and where it goes. We’re still extremely early into this integration.”
“This is the biggest thing our company has ever done. And obviously, it definitely distracts a lot but we’ve managed to perform through it. We do see a lot of our competitors taking advantage of the fact that we had this integration both by focusing on the fundamentals and the reason we acquired this company in the first place which is to connect these two ecosystems,” Dorsey added, according to a transcript of the call.
Buying Bitcoin with Klarna (Safello)
There is also BNPL player Klarna, which partnered with Swedish crypto exchange Safello in Feb. 2021 to provide brokerage access to thousands of banks in the European Union.
“This partnership, which is Klarna’s first entry into the cryptocurrency industry, marks a new era in financial innovation,” the company said at the time in a press release.
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