One of the main struggles the blockchain industry faces is making cryptocurrency practical for the average person. People who know very little about cryptocurrency do not want to spend time switching between various wallets and exchanges – they want to be able to use their funds as quickly and easily as possible. One of the most effective ways to allow for this is with the creation of crypto debit cards. These are regular debit cards that can also hold cryptocurrency as well as fiat. They can be used in any shops that accept standard debit and credit cards, making them the most accessible way to handle your cryptocurrency while on the go. They bridge the gap between cryptocurrency and fiat money.
One of the largest providers of crypto debit cards was WaveCrest. Companies would partner with WaveCrest and use their service to issue their own branded cards. Organisations like TenX, BitPay, and CryptoPay relied on them. They were the market leaders at the time, but Visa made a decision to cut ties with them entirely, and when they did, every company that used WaveCrest suffered too.
Why did Visa stop working with WaveCrest?
Visa’s reasoning for banning WaveCrest from their services was due to a compliance issue. In a statement, Visa said that ‘We can confirm that WaveCrest’s Visa membership is being terminated due to non-compliance with our operating rules,’ further explaining that ‘All WaveCrest-issued Visa card programmes will be closed as a result.’ Visa gave almost no warning to either companies or card holders, so when the termination went into effect, many users temporarily lost access to their funds. Cards would no longer be accepted in any shops. It also meant that many crypto companies had to close their services or go on hiatus so that they could find solutions.
At the time, it seemed like the dream of having crypto debit cards was over, but the cryptocurrency and blockchain industry is resilient, and a handful of card providers kept going. For instance, Wirex has issued over a million debit cards to customers to date, and Monaco is still in the process of creating crypto debit cards with Visa.
Why was Visa’s decision a mistake?
While crypto debit cards are still being made in conjunction with Visa, fewer companies are doing so. It is hard to imagine that Visa made the right decision when terminating WaveCrest. By doing so, they partially set back the crypto industry, but most of all they set themselves back – companies are already seeking alternative payment providers such as Mastercard to facilitate transactions. The loss of WaveCrest cards has meant a loss on the commissions Visa makes, and if crypto cards become mainstream, VISA will have lost a significant amount of money.
