Crypto vs. Credit: Understanding the Relationship and Impact on Your Score

The ratio of crypto to credit score

If you have a credit card, take out a loan, or use another type of credit (ie money that doesn’t technically belong to you), it can affect your credit score. Your credit rating can help others see how risky it is to lend you money. If your credit score is low, you’re horny as a riskier borrower. If it is higher, you are considered less risky.

If you default on loan or loan repayments, it will negatively affect your credit score. But how does it actually work with cryptocurrencies?

Cryptocurrencies are a much more restricted asset than traditional money and are accepted by far fewer providers and banks around the world.

When do cryptocurrencies not affect your credit score?

There are several instances when buying, selling, or using cryptocurrencies will not affect your credit score.

For example, if you trade cryptocurrencies through a debit card or bank transfer, the cryptocurrencies themselves and how you use them will not affect your credit score.

Even if you take out a crypto loan in the DeFi area, this will not affect your creditworthiness. Again, this is because cryptocurrencies per se are not associated with credit.

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