Crypto cards, in practice: who uses them, and what happens next – part 3

Beyond the mechanics and the ecosystem lies the real question: does anyone reach for a crypto card over their regular bank card, and if so, why?

Part III weighs the genuine advantages against the friction points, maps the regulatory patchwork shaping the market, and closes the series by asking where this goes from here.

Part I of this series looked at why crypto cards now, and how they work behind the scenes. Part II mapped that ecosystem, breaking down the debit, credit, and secured products it produces, and explaining why stablecoins are no longer just one funding option among several, but the force reshaping the category's economics. This final instalment turns to the people using these cards: why they choose them, what the honest trade-offs are, how tax and regulatory treatment differ across major markets, who's competing to lead the space, and where it all points next.

Who uses crypto cards?

It is a fair challenge to put to any provider. If a crypto card can involve an exchange spread on every purchase, and spending volatile assets can trigger a taxable event in some jurisdictions, why would anyone choose it over a normal bank card?

The honest answer is convenience for a specific group of users, rather than a better deal for everyone. People holding a meaningful share of their wealth in digital assets can spend directly from that balance without first selling manually and moving money to a bank account, since the conversion happens automatically at the point of sale. Rewards have also proven a genuine draw, with programmes from Crypto.com, Nexo, and Coinbase offering cashback in crypto or platform tokens alongside lifestyle perks such as lounge access and subscription rebates, even as the exact terms and staking requirements shift over time and vary considerably in generosity between entry level and top tier accounts.

Crypto cards also solve a real problem for globally mobile users. Freelancers, remote workers, and people paid in stablecoins can spend directly rather than waiting on international bank transfers or repeatedly converting currency, which matters most in markets where international banking access is limited or where cross border payments remain slow and expensive. The World Bank's own tracking shows why this matters: the global average cost of sending a USD 200 remittance still sits at 6.36% as of Q3 2025 - more than double the UN's Sustainable Development Goal target of 3% - with banks remaining the most expensive channel at nearly 15%.

Finally, for a segment of users, a crypto card is part of a broader digital asset lifestyle rather than a purely functional choice. Premium programmes from providers such as Crypto.com and Ledger pair the payment function with events, early product access, and networking, turning the card into a signal of participation in the wider crypto economy as much as a way to pay for lunch.

Crypto cards: the real benefits and the trade-offs no one advertises

For an executive audience weighing whether this segment deserves attention, it is worth setting out the trade-offs plainly rather than leaning only on the marketing case.

On the benefit side, crypto cards give holders of digital assets genuine liquidity without forcing a manual sell and bank transfer first. They extend the reach of stablecoins into ordinary commerce by riding on existing Visa and Mastercard acceptance networks rather than requiring merchants to build new infrastructure. As Eric Barbier, founder and CEO of Triple-A, has put it, the appeal for merchants is precisely that they never have to touch crypto at all - brands such as the luxury platform Farfetch can reach a global base of stablecoin users while continuing to settle in fiat, reconcile, and report exactly as they always have. They offer freelancers and cross-border workers a faster route from crypto or stablecoin income to everyday spending. And for card issuers and networks, they represent a new customer acquisition channel and a genuine, if still modest, source of interchange revenue growth at a time when core card volumes in mature markets are growing more slowly.

On the drawback side, the exchange spread applied at conversion is a real and sometimes opaque cost, one that a zero-fee marketing claim can obscure rather than eliminate. Spending volatile assets such as Bitcoin can trigger taxable disposal events on every transaction in many jurisdictions, a genuine deterrent that stablecoin funded cards only partially solve. Reward structures are frequently tiered behind staking requirements that lock up capital and expose the user to the issuer's native token, which can itself be volatile and illiquid. Custodial models concentrate counterparty risk with the platform holding the funds, a risk made vivid by past exchange failures and hacks across the industry. FTX's 2022 collapse remains the clearest cautionary tale for custodial risk specifically, alongside the 2022 Celsius bankruptcy, and more recently a wave of exchange hacks, including Bybit's ~ USD 1.5 billion theft in February 2025, the largest crypto heist on record, later attributed by the FBI to North Korean state-sponsored hackers. And regulatory treatment remains genuinely unsettled in several major markets, meaning the compliance burden and reporting obligations attached to a crypto card can shift with little notice.

Crypto card taxes and regulation: what changes by country

Regulatory treatment varies significantly by jurisdiction, and this is an area where the rules have moved quickly enough that anyone advising a client or building a product needs to check current guidance rather than relying on older summaries.

In the UK, spending cryptocurrency through a card generally counts as a disposal for capital gains tax purposes, since the asset is being exchanged for goods or services. Every individual has a tax free annual exempt amount of 3,000 pounds, which cannot be carried forward, and gains above that threshold are taxed at 18% within the basic rate band and 24% above it, the same unified rate structure that applies to property, shares, and other chargeable assets following changes introduced from October 2024. This is precisely why stablecoin funded cards are gaining ground over Bitcoin funded ones among tax conscious users: converting a stablecoin that has not meaningfully moved in value creates little or no taxable gain, whereas converting an appreciated Bitcoin holding to buy a coffee can, in principle, trigger a reportable disposal.

In the EU, the picture is becoming more transparent to tax authorities rather than more favourable to users. The DAC8 directive requires crypto asset service providers operating in the EU to automatically report user transactions to tax authorities, meaning that, as several industry commentators have put it, card payments funded by crypto are no longer effectively invisible to regulators the way they may once have felt to individual users. This sits alongside the broader Markets in Crypto Assets regulation, MiCA, which already governs how crypto asset service providers, including many card programme operators, must be licensed and supervised across the EU. 

In the US, the regulatory picture shifted meaningfully with the GENIUS Act, signed into law in July 2025, which established the first federal framework specifically for payment stablecoins, distinguishing between bank and non-bank issuers and setting out reserve and disclosure requirements. For card issuers and the fintechs building on top of stablecoin infrastructure, this has provided a degree of regulatory clarity that was largely absent before, and it is frequently cited by infrastructure providers such as Bridge as the basis for describing their stablecoin issuance products as ready for that framework. 

For a bank or PSP evaluating whether to enter this market, the practical takeaway is that tax and regulatory treatment differs enough between the UK, the EU, and the US that a single global product strategy is unlikely to work without local adaptation, and that stablecoin funded products currently carry a meaningfully different compliance and tax profile than Bitcoin funded ones in most major markets.

Who's competing to lead the crypto card market

Stepping back from individual products, the competitive landscape now spans several distinct categories of players, each approaching the same basic proposition from a different angle.

Exchange native cards from Coinbase, Crypto.com, Bybit, Bitpanda, and Nexo remain the largest and most established segment, built around custodial accounts that most users already hold for trading purposes, with the card simply extending that account into everyday spending. Self-custody focused products such as Gnosis Pay and MetaMask's own card push in the opposite direction, linking a card directly to a non-custodial wallet so that a user's crypto never leaves their own control until the moment of a transaction. Infrastructure providers such as Bridge and Rain sit a layer beneath both categories, powering white label card programmes for fintechs and neobanks that want to offer stablecoin funded spending without building the underlying banking relationships, custody, and card issuing capability themselves.

The card networks and legacy payment giants now sit visibly above all of this, treating the segment as strategically significant even where they remain publicly cautious about near term consumer demand. Visa's stablecoin settlement run rate has reportedly reached an annual run rate of around 7 billion dollars, up more than 50% quarter on quarter according to figures shared on its own earnings call, while Mastercard's acquisition of BVNK and its Crypto Partner Program, which now brings together more than a hundred crypto native companies and financial institutions, reflect a similar bet from its closest rival. What ties all of these players together, whatever their specific model, is the same underlying insight that a card interface remains the fastest way to make a digital asset spendable at a merchant that has never heard of blockchain.

Where the market is heading

Today, a typical crypto card transaction still follows a traditional path: digital assets are converted to fiat by the issuer, the payment is routed through Visa or Mastercard, and the merchant receives fiat. That is starting to change. As payment processors, banks and card networks build out their stablecoin capabilities, some transactions are beginning to settle directly in stablecoins, with the merchant or payment service provider choosing whether to receive stablecoins or local currency. Visa's own pilot with Bridge and Lead Bank, which settles certain transactions on the Solana blockchain, is an early example of this happening at network scale rather than as an experiment on the fringes, and the newly announced Open USD consortium, backed jointly by Visa, Mastercard, Stripe, Coinbase, BlackRock, and Google, suggests that even competing infrastructure players see enough shared value in a common stablecoin standard to work together on it, at least for now.

That said, the caution voiced by Visa and Mastercard executives about near term consumer demand should temper any assumption that this transition happens quickly or uniformly. Adoption is likely to remain concentrated for some time in specific use cases, cross border remittances, freelancer and contractor payouts, treasury operations for businesses already holding stablecoin balances, and spending by consumers in markets where local currency instability makes a dollar backed alternative genuinely more attractive, rather than becoming a mainstream substitute for a bank card in developed markets any time soon.

Conclusion: crypto cards are only the beginning

Crypto cards may ultimately prove to be less important than the infrastructure they have introduced. To consumers, a crypto card is simply a familiar payment card that happens to draw from a different kind of balance. To the payments industry, it represents a bridge between blockchain-based money and the existing card ecosystem, one built to feel unremarkable precisely so that it can scale. As stablecoin settlement becomes more widely adopted by issuers, payment processors and merchants, the card itself could increasingly become just the interface, a familiar tap or swipe sitting on top of payment rails that are quietly becoming faster, more programmable and less dependent on the multiple currency conversion steps that still define much of cross border commerce today.

In that sense, crypto cards are not the destination. The pizza has already been bought, and the tap has already worked. What comes next is less about whether people will spend digital assets, and more about how much of the payments infrastructure underneath quietly moves onchain before anyone standing at the till notices the difference.

If you're joining at the end of this series, we'd recommend starting from the beginning: Part I covers why crypto cards now and how they work behind the scenes, and Part II maps who issues them and why stablecoins are reshaping their economics.

About author

Mirela Ciobanu is Lead Editor at The Paypers, bridging the knowledge gap between TradFi and DeFi. With a keen eye for industry trends, she is constantly on the lookout for the latest developments in crypto and blockchain. Closely connected with subject-matter experts in the digital assets space, Mirela amplifies your voice through compelling interviews, webinars, reports, and articles.

To share more ideas and get inspired, connect with Mirela on LinkedIn or reach out via email at mirelac@thepaypers.com.