Quontic Bank and the fintech NYDIG have partnered to launch a bitcoin rewards card to Quontic’s customers.
Patrick Sells led this project while he was chief innovation officer at the $1.4 billion-asset Quontic. Last week he joined NYDIG, a provider of bitcoin services, as head of bank solutions.
The new bitcoin rewards program pays 1.5% back in bitcoin rewards for every debit card transaction.

“The overarching goal is to enable Quontic to grow a deeply engaged base of demand deposit account customers who will choose our debit card over others in order to earn bitcoin,” said Steven Schnall, founder and CEO of Quontic. “We have found that the opportunity to be rewarded in bitcoin resonates with both the bitcoin enthusiast and bitcoin beginners.”
In surveys Quontic conducted over the past two years, more than 20% of respondents said they would be willing to move their checking account to a bank that would pay them rewards in bitcoin, Schnall said.
Quontic presented its regulators with the concept of a bitcoin rewards checking account nearly two years ago.
“It was met with receptivity, but it was clear that we had to make a strong case and demonstrate that we had fully addressed all areas of risk, security, disclosures, processes, vendor diligence and so on,” Schnall said. “We engaged outside counsel and also had the assistance of our fulfillment partner, NYDIG. It wasn’t until we got our regulators comfortable that we pushed forward with the technology build out.”
The technology lift was a heavy one, Schnall said. The bank had to build an integration between its core system and NYDIG. Then it developed a user interface with the core-systems vendor FIS. Quontic and FIS are collaborating on a mobile app with bitcoin rewards tracking and reporting that is set to launch in the second quarter.
The bank and NYDIG got the Office of the Comptroller of the Currency’s approval on the new product.
This is how it works: The customer opens a bitcoin-rewards checking account through the usual process at Quontic. The bank handles onboarding, know-your-customer compliance and identity verification. At the same time, NYDIG opens a mirrored bitcoin wallet that’s on NYDIG’s balance sheet. If a customer spends $200, earning $3.00 in bitcoin rewards, Quontic Bank sends $3.00 to NYDIG and asks it to buy $3.00 of bitcoin and put it in that customer’s wallet.
“The bank never owns bitcoin on its balance sheet, so there’s no risk to it,” Sells said.
If the price of bitcoin goes up, the customer’s rewards become more valuable. If the price of bitcoin drops, the rewards depreciate.
“We did a lot of studying around this,” Sells said. “Most people, if their Amex points become less valuable, don’t feel like they’ve suffered a…
Read more:Quontic Bank launches bitcoin rewards checking with help from NYDIG