In September 1958, Bank of America bulk-mailed credit cards to 65,000 residents of Fresno, California. This was the first payment card launched without supporting underlying infrastructure. One year after launch, the business was dismal, with a delinquency rate of 22% and losses as high as $20 million. The industry spent 15 years building an electronic settlement system; debit cards took another 17 years to officially appear, and Visa spent a full 20 years establishing a globally accepted payment standard.
The biggest watershed between traditional payment and crypto payment lies in whether they foster users' routine financial account relationships. Debit cards were born in 1975, but only became a standard feature of individual core bank accounts after salary deposit services became widespread in the 1990s. In contrast, for today's crypto payment cards, the main funding source is basically users self-topping up stablecoins; the vast majority of crypto wallets cannot handle daily financial flows like salary deposits or scheduled bill payments. The industry's overall development stage is roughly equivalent to that of debit cards around the early 1990s.
The future leader in the crypto payment card race won't be determined by the number of cards issued, but by who first builds a core account that truly serves daily income and expenses, or finds a growth driver that fosters long-term user retention.
Monthly Transaction Volume of $1.5 Billion Does Not Equate to Industry Maturity
According to data from analytics firm Artemis, the monthly transaction volume of crypto payment cards grew from $100 million in early 2023 to $1.5 billion by the end of 2025, representing an annualized scale of approximately $18 billion. Affected by variations in on-chain data statistical methods, the actual annualized figure may fluctuate slightly, but the explosive growth in transaction volume is an indisputable fact.
A closer analysis of these metrics reveals significant concentration among services and regions. Leading service provider RedotPay alone accounts for over half of the entire industry's transaction flow; platform users are highly concentrated in emerging markets: Bangladesh accounts for 11%, India 8%, Egypt 6%, Nigeria 6%, with the US representing only 4%.
This shows that the real demand for crypto payment cards does not come from developed mainstream markets, but from developing regions with insufficient financial services and restricted access to USD.
Compared to mature financial networks, the scale gap of cryptocurrency remains vast. Visa and Mastercard's annual total payment volume reaches $24-25 trillion, while crypto payment card annualized transactions are merely $18 billion. They are not on the same scale.
The velocity of circulation indicator, which measures the penetration of daily payments, is also relatively low. According to Visa statistics, the retail circulation velocity of on-chain stablecoins is only 0.08, merely one-twentieth of the velocity (1.65) of narrow fiat money M1. The pattern of stablecoin usage for most users is not the routine cycle of salary deposit, daily spending, and top-up recharge, but rather a one-time top-up followed by intermittent card spending.
Growth in transaction volume numbers does not equate to the market forming a mature, universally accepted clearing system. Currently, a large portion of crypto payment card transactions come from users in emerging markets who lack convenient access to USD-denominated bank accounts. For these users, crypto cards indeed possess practical financial value.
However, in developed markets, crypto payment cards have yet to find a stable product-market fit, nor have they established the deep account binding relationships brought about by features like salary deposits and automated bill payments.
Considering both funding channels and spending scenarios, current crypto payment cards are better suited for specific country-specific niche needs, acting as supplementary tools rather than universal financial infrastructure. Nonetheless, amidst the industry's rapid growth, leading players across four major business models are simultaneously refining various aspects of the industry chain.
Four Mainstream Business Models for Crypto Payment Cards
The crypto card industry can be broadly categorized into four business models, with various participants vying for first-mover advantage at different layers. These models vary widely, from companies focused on providing backend infrastructure to those merely adopting the card form factor but with entirely different underlying structures.
Card Issuing Infrastructure
The well-known payment networks Visa and Mastercard also apply to the crypto card ecosystem. Beneath them lies the card issuing infrastructure layer, which ultimately extends to the consumer card. As shown in the diagram above, there are two structures within the issuing infrastructure layer. The first is the traditional two-tier structure, where the program manager responsible for operations is separate from the issuing bank responsible for member management and settlement. The second is the full-stack issuer, such as Rain and Reap, which combines these two roles.
Multiple seemingly independent payment card brands actually reuse a handful of program service providers at their core. Phantom Card, MetaMask Card, and Gnosis Pay are typical examples.
Seemingly independent payment card products like Kast, Ether.fi, Tria, and Plasma One similarly share a small number of underlying infrastructure service providers, with Rain handling the majority of consumer-grade card business.
The high concentration of issuing infrastructure has also attracted established traditional digital banks to enter the fray. In March 2026, Nium launched a stablecoin card issuing platform, supporting both Visa and Mastercard networks. Other traditional financial infrastructure vendors include Bridge (acquired by Stripe for $1.1 billion in early 2025) and BVNK (acquired by Mastercard for up to $1.8 billion in March 2026).
Competition in the issuing sector is intensifying, with full-stack issuers, veteran program managers, and new fintech players competing on the same stage. Pure card issuing business alone can no longer build high barriers.
Rain has differentiated itself by leveraging daily stablecoin settlements. Traditional card settlement cycles take several days; Rain achieves T+0 settlement for stablecoins through Visa, significantly improving capital turnover efficiency for partner platforms like Ether.fi. Recently, the platform launched an AI Agent control layer, enabling programs to automatically generate disposable virtual cards, moving functionality beyond basic issuing infrastructure.
Issuing service providers seeking to break through cannot merely offer basic payment rails; they must also rapidly implement differentiated value-added features that traditional infrastructure cannot provide.
Exchange-Attached Payment Cards
For exchanges, payment cards are not a core revenue source; their primary role is to retain existing users. By overlaying card functionality onto the platform's existing user base, assets, and transaction data, they aim to prevent user churn. The platform's real profits come from trading fees, lending services, and asset custody, not from card spending itself.
Exchanges view payment cards as a traffic entry point for building a financial super-app. However, the platform's native token cashback model carries risks: token price volatility directly leads to unstable actual cashback ratios.
Industry alternatives include stablecoin cashback and balance interest accrual, but the US "GENIUS Stablecoin Act" prohibits interest-bearing activities, creating a barrier to market expansion.
Decentralized Wallet DeFi Model
The core logic of this model is that the wallet itself is the user account, with assets self-custodied on-chain, eliminating the need to deposit them with a centralized exchange. Card spending is settled directly from on-chain assets. Simultaneously, it offers a line of credit, using the assets as collateral.
However, users need to set up vaults, manage collateral, and monitor liquidation risks themselves, resulting in high operational barriers. This consequently limits the scale of the user base for this model.
During payment, the system instantly converts on-chain assets to fiat for settlement, generating on-chain Gas fees for each transaction; when public chain throughput is insufficient or the network is congested, fees may exceed the spending amount, and transaction authorization delays are frequent.
For this reason, MetaMask Card opted for its self-developed Layer-2 network Linea, reducing per-transaction Gas fees to around $0.01, alleviating the pain points of high fees and delays for small payments. Tria employs a Gas-less top-up solution, with the platform covering fees generated during top-up, sparing users the operational cost of selecting blockchains and calculating fees.
However, until the user experience, balancing asset self-custody with spending convenience, is polished to the level of traditional debit cards, this model's users will remain confined to native crypto users.
Stablecoin Digital Bank
This is the segment with the highest share of current market transaction volume. Its focus is on account functionality rather than the card itself. Stablecoin balances integrate foreign exchange, cross-border remittance, and wealth management features, with the payment card merely serving as the top-level spending vehicle. In emerging markets with high local currency volatility, costly cross-border remittances, and difficult USD access, this model possesses strong competitiveness.
To sustain growth, this segment must move beyond the single form of a "prepaid card" model, where users autonomously purchase stablecoins and transfer them to their balance.
Cashback strategies across platforms have diverged based on market positioning. Industry leader RedotPay and established fintech player Revolut offer no cashback campaigns, while later entrants like Kast and Plasma One aggressively promote USD or platform token cashback to attract users.
However, relying solely on incentive subsidies cannot drive crypto payment cards to truly integrate into users' daily consumption habits.
Pure Payment Functionality Cannot Support Long-Term Development
The history of traditional bank cards and digital banks demonstrates that pure payment businesses have extremely low profitability ceilings. These enterprises only became profitable after incorporating concepts like the primary account and structural elements such as deposit-loan spreads into their business models. The crypto payment card industry has now reached the same critical development point. However, global regulatory frameworks like the US GENIUS Act and the EU's MiCA restrict the development of interest-bearing stablecoin and asset management services, making the path to breakthrough arduous.
Under these macro regulatory constraints, for industry players to survive long-term, they must grasp three core strategic imperatives:
- Directly control the fund flow pathway.
- Secure unique application scenarios in emerging markets.
- Build proprietary user account systems that cannot be replaced by underlying infrastructure providers.
After industry standards solidify, companies unable to achieve the above will gradually fall behind.
Looking back at the history of debit cards, those who ultimately dominated the market were not the ones issuing the most cards, but those who first gained control of users' primary bank accounts. The crypto payment card industry now faces precisely the same proposition.
Crypto card operators need to directly control the fund flow upstream of the Visa payment process, seize first-mover advantage in niche markets, and, akin to the rise of bank accounts in traditional finance, take control of consumer infrastructure. This means establishing a global standard with no precedent to follow.
Without achieving the above, crypto payment cards will never become essential tools integrated into daily life, remaining merely prepaid cards used intermittently by niche groups for small cashback rewards.
