Bitcoin for CC Churn?
 

I was curious if anyone has used Bitcoin to hit a minimum spend on a cc. There are websites where you could buy bitcoin with a credit card. you can then exchange it back into USD and pay off the credit card while only paying the transaction fees.

Is this an alternative to Vanilla/Bluebird?

Bitcoin is down 1.41% today and it's only 11am. You sure you want to use something that volatile just to earn miles? Oops, 1.45% as I typed this message.

I would be happy to sell you bitcoins so you can rack up miles.

There are plenty of websites (starting with eBay) where you can buy something used with a credit card and then sell it back later getting payment with PayPal into your checking account. Maybe at a higher price, maybe a lower price.

So how it that so different than a currency which could go up or down between the time you buy it and the time you sell it?

Ie, because Bitcoin is a floating currency, you won't be paying only the transaction fees; you'll also be paying for any loss that Bitcoin may have between the time you buy it and the time you go to exchange it back into USD. (Which is the same situation you may get if buying and re-selling used merchandise, if you happen to buy higher and then sell lower. It's not easy to predict the future value of some used merchandise, but it's even harder to predict future Bitcoin exchange rates.)

So it's not all the same as traditional Manufactured Spending (MS) money-equivalent instruments (like Vanilla/Bluebird used to be) where the costs are predictable and unchanging (until a particular MS method stops working, at least).

Thanks everyone. You make good points. I appreciate the honest feedback.

One thing you have to keep in mind that people who do MS are extremely risk averse. If they had the choice to make 1 dollar without risking, or 100 bucks risking 5. they will choose to only make 1 dollar.
with that said, you are preaching to the wrong set of people. Of course they will tell you that BTC is losing money. But the truth here is that not only BTC didnt lose value over the years, it gained.

Sure, BTC is very volatile and there are risk involved.however, traditional MS does not involve risk and given how much you are willing to risk and the assoicated method you use (how fast you can swap USD with BTC), it could be a bigger money maker than conventional MS. But then again, who am I to speak? most ppl have their mind made up.

This is also why most MS will be MSing for the rest of their life. No risk, no gain.

I found this thread very interesting. I'm hoping more people with experience decide to contribute. I'm not entirely risk averse, especially knowing that had I gotten in when BTC was on the ground floor, it'd be worth a ton. It can certainly drop in value, but it can also go up.

For meeting minimum spends, a 1% decrease (or spending 1%) is palatable to most people, if the alternative is not meeting minimum spend.

Oh, and another analogy to Bitcoin would be if something like the Mint still existed, but only in a foreign country with coins in a foreign currency (but purchasable with a USA credit card and shippable to USA address). You'd get coins in a different currency, which floats relative the US dollar, and thus sometimes you'd come out ahead and sometimes behind (on converting them to US dollars). The only reason the Mint worked for those in the USA was because the coins were in their home currency.

Just and FYI I know people who have had CC closed for doing this.

Any details on it? Where did they buy BTCs?

Help me figure it out. What profit can I get with bitcoins? I would like to hear good recommendations on how can I do it. My buddy recommended me to read this article https://bitcoinbestbuy.com/. It is written very well and has big amount of details, so I got to know a lot of interesting things, but I want to know the sum of money.

It's the same as the answer to the question: "How much money can I make in the stock or bond markets?" It all depends upon how much you are willing to risk and the timing/timeline of your investments relative to market movements.

Without trying to sound mean or snarky, if you are asking that question on a frequent traveler message forum, you should not be considering this option.

I cycle $2K per week using digital currencies.

I buy bitcoin/ethereum on coinbase. Coinbase charges 3.99% to use credit card (most exchanges don't allow credit card and those few do charge even more) and only allows you to place market order (please look up difference between market vs limit order if you don't know). I then transfer what I bought to GDAX, coinbase's sister site where you can set limit order and set a limit sell order at 4% above what I bought it for so I can forget about it and don't have to keep watching the price. Once sold, I withdrawal the cash back to my bank account.

To prevent fraud, coinbase has a credit card spending limit of $500/week for new users, they will move it up to $2K/week once you use them for a couple months. Like other people already mentioned, digital currencies are highly volatile. They can move 20% up or down a day. There are a lot of risks so I wouldn't recommend keeping a large position longer than you have to.

How long have you been doing this for? Ever lost money on it?

Do your limits stay consistent? When I first opened my account, I had a $500 CC and $2k bank account limit. Ever since then, it fluctuates all over the place without me doing any funding. This was all around the rush at $4k and into $5k, my limits would drop randomly, to the point where my CC limit is $50 now. Then it might go up a little, then back down, and I haven't even touched my cc funding. Or I'll fund part of my limit, then my limit drops to like $1.