From customer acquisition tool to ecological entrance: in-depth analysis of the business logic and future form of U card

@Solana_zh Radio Last week, Space invited the three leading U card projects, Bybit / Infini / Solayer, to chat together. I have always been interested in the payment and consumption tracks. How could I miss such a good opportunity for in-depth discussion? I quickly accepted the invitation of @ynonestop @1cryptosheep and discussed this highly-watched PayFi track with Bybit Card Product Manager @76Yuchenchang, Infini co-founder @0xsexybanana and Solayer's Founding Engineer @ChazChazC.

With the increasing adoption of cryptocurrencies and the expansion of the stablecoin market, the U card is no longer a simple withdrawal tool, but has evolved into a key strategy for customer acquisition, asset management, and ecosystem construction. The three guests revealed the business logic behind the U card from different perspectives: for exchanges, it is a link between users and platforms; for asset management companies, it is the entrance to fund management; for blockchain native projects, it is a medium to deepen user relationships.

Interestingly, although the U card itself is not a high-profit business, it has attracted extensive participation from trading giants to entrepreneurial teams due to its strategic value in user acquisition and ecosystem construction. This trend of "moving from virtual to real" not only reflects the industry's desire for practical application scenarios, but also heralds the acceleration of the integration of encrypted payments and traditional financial systems. With the entry of payment giants such as Visa and Mastercard, the U card track is ushering in unprecedented competition and innovation, bringing users more diversified choices and experiences.

I also learned a lot myself, and after Space ended, I compiled this transcript to review it again.

If you are also interested in this field, welcome to read

Three guests introduced

U Kakop: How to classify, what is the business model, how big is the market space, what is the core competitiveness, and what risks exist?

How to increase the number of U card users?

What are the pain points in the use scenarios of U Card? How do you solve these pain points?

Can U Card be compared with credit cards?

Why did the number of U cards surge this period? The impact of Visa/Mastercard’s entry

The relationship between U Card and PayFi

How to choose the most suitable USB card: precautions and pitfalls

Legal and compliance risks

The future of U Card

1. Introduction of the three guests

Crystal: Hello everyone, I am Crystal, and I am currently the product manager of Bybit Card. I am very happy to be here to communicate with all the experts and share the story of Bybit Card.

Princess Christine: Hello everyone, I am Princess Christine, the co-founder of Infini. Infini is a Yu'ebao project in the crypto. U can be used in Web2 while enjoying the benefits of Web3. Nice to meet you all.

Chaz: Hi everyone, I’m Chaz, Founding Engineer of Solayer. I’m happy to talk to you about the story of the card we just launched.

2. U Kakopu: How to classify, what is the business model, how big is the market space, what is the core competitiveness, and what risks exist?

Princess Christine: U card is actually an unprofitable business. Everyone who does U card does not make money or only gets a small subsidy. So why do so many people want to do it? Because it is a means of acquiring customers and attracting traffic. The purpose is to attract traffic to exchanges. For example, Bybit and Bitget are both doing U card, and OKX will also do it. Another way is to attract traffic to asset management companies like us. Infini itself is a new bank, and our profit model is also through asset management.

If you want to do it for a long time, you need to invest a lot of energy and time to maintain it, because it is essentially closer to the Web2 financial technology track and a little bit away from Crypto. From the perspective of company operations, it also needs to be closer to Web2 companies.

As for the differences between U cards, they are mainly divided by region, because U cards are issued by specific banks, the upstream is the card organization, and the upper layer is the issuing bank, and the upper layer of the issuing bank is payment networks such as Visa, Mastercard and Discover. For example, Bybit is a European card, and Infini and Solayer are US dollar cards. This is distinguished according to the different regions of the issuing bank. There is no exchange rate conversion fee for US dollar cards when consuming subscription products. Bybit's card will have a better exchange rate in Europe because it is a euro card issued by a European bank.

Therefore, when choosing a U card, you must base it on the country you are in and the consumption scenario. If you often travel in Europe, choose a card issued by a European bank; if you often need to subscribe to American services, such as ChatGPT, it would be better to use a US dollar card.

Crystal: The princess gave a very complete speech, basically describing the basic information of the U card. Bybit has two advantages in the U card market: First, we have the support of many traders, who use various trading services on Bybit and will eventually have a need to withdraw funds, which is a rigid demand of exchange users or any Crypto adopters. Platform users are very supportive of us, which enables us to cooperate with other product lines, not only withdrawals, Bybit Card also supports financial management (such as current financial management), and provides trading discounts, such as Trading Voucher, etc.

Secondly, we have more than just the European card, which is our first card, because Europe has a high rate of Crypto adoption. We have also issued local cards for countries such as Australia and Latin America (such as Argentina and Brazil), supporting local currencies, because settlement may require the use of legal currency. Therefore, the payment currencies we provide to users in different regions are also different, which also echoes the point made by the princess just now.

The core competitiveness lies in the large scale of the platform and the large market space. In terms of business model, the cryptocurrency card connects the card organization and the supplier, which requires a lot of energy and labor, and many access tests. The cost behind it is huge, just to provide the smoothest experience. We are also actively looking for ways to provide users with a better experience.

Chaz: The two speakers above have given a comprehensive overview of the entire industry. I will focus on Solayer's perspective. This card is a very reasonable part of our product line, because we started out as a Restaking company, and the core logic is compound interest, which guarantees you specific returns while giving you additional returns. Our product line includes Restaking SOL and Solayer USD, which is the staking of stablecoins. In essence, it is to obtain interest rates from US Treasury bonds and bring them to the chain.

Now that users have so many on-chain assets, how do they get through the entire on-chain banking system when they earn income from you? For example, if you put your money here, you can get income from savings cards and Yu'ebao, but how can you spend the money more conveniently? Only when it is convenient to spend money will they be willing to deposit more funds with you. This is essentially the logic.

Therefore, it was natural for us to think that if we have on-chain income, can we make something that allows you to consume offline directly? So we made the card. There are two main reasons why this is worth doing: First, it can establish a deeper binding relationship with users. Every time the user swipes the card, they will think of you, which is very important for a Crypto native project. Secondly, we can indeed attract more new users to our ecosystem, especially the Solana ecosystem, through this. The funds on the Solana chain have been relatively active in the past six months. If you have been in the Solana ecosystem, you will know more about the promotion methods in the Solana ecosystem, which is one of the reasons why we do this.

3. How to increase the number of U card users?

Chaz: Our current method of attracting users is very simple, because we have just completed the airdrop of Season 1, and there will be an airdrop of Season 2 later. In addition, we are an ecosystem, and many new projects on the chain may give corresponding points.

Princess Christine: I have indeed been insisting on not using the points system and airdrop expectations to drive growth. This is related to my personal experience, because I have worked on many projects. If the project is driven by airdrop expectations and the points system, it will cover up the problem of PMF itself. So at the beginning of the product creation, I told all KOLs and others that Infini will not issue coins, and there may not be a points system (maybe related to VIP benefits), but it will definitely not issue coins. I think that if you can still use it without me issuing coins, it means that the business model is established and the product does not need to rely on tokens to make profits, which is very important to me.

Using tokens to drive growth is a unique growth method in the crypto, but I told myself that I would use the most difficult method to start. If I could start this way, then it must be fine and we must be on the right track. Moreover, using tokens to drive growth will cover up some product problems, because users will use your product anyway in order to farm tokens. My idea is that in the early stages of a company's growth, this kind of token-driven marketing cannot hide company problems, and they need to be fully exposed, so I have never adopted a token-driven approach.

As for the low cost of acquiring customers, ours is indeed low. I have done in-depth research on Bybit's growth and new customer acquisition methods. I have studied how much you spend each period, what kind of Leaderboard you have, and what kind of Cashback policy you have. But the situation of Infini and Bybit is different. Bybit is a track with a very high profit margin, and the exchange can support the high cost of acquiring new customers. But Infini currently has no exchange business, so it needs to minimize the cost of acquiring customers. Once the cost of acquiring customers becomes high, we will be caught in a subsidy war and it will be difficult to compete with large exchanges. From the first day, I told myself that I could not compete with powerful project parties such as Bybit, OKX and Bitget, and I had to find another way.

Our alternative approach is to make the card perfect. If you use the Infini card, you will find that it is very smooth from registration to use, with a low threshold and the most friendly to retail users. I also spent a lot of time modifying the Onboarding Process, so that users can activate the card in 3 clicks, instead of a complicated process. I think more about how to drive growth with products from a product perspective, rather than relying on investment and subsidies. Of course, if we have money, we will definitely work hard, but now we don’t have money, so we are "surrounding the city with the countryside" and "Xiaomi plus rifles".

Another valuable point is that users have very multi-level needs in terms of cards. We are slowly exploring these hidden needs and realizing them through product functions. We should be the project party that spends the most time on card development and product functions. Including the commonly mentioned supplementary cards, family cards, intimate payments, etc. are all in my plan, and easy deposits and withdrawals are also in the plan. Infini will soon be like Backpack, allowing everyone to deposit and withdraw funds with one click on our platform, which is also a rigid demand. So I spend a lot of time on products and try to spend less money. I am indeed very stingy. In the early stages of the company's entrepreneurship, I need to think about how to survive in the war between giants.

It looks good now. We are growing very fast, and the entire market launch only cost 3,000 U. This can be regarded as a marketing case. When Infini succeeds in the future, I will share some experience and secrets, but for now, it is mainly product-driven growth, that is, Product-led Growth.

4. What are the pain points of using U card? How do you solve these pain points?

Chaz: There are several user pain points:

First of all, many cards will restrict you from spending in certain places and directly block you, such as OnlyFans, Pornhub, etc. But we found that this demand is quite large.

Secondly, there are usually many restrictions on large purchases. You can buy a Ferrari directly with a Solayer card. The reason for these restrictions is that banks are worried about money laundering and must control risks, otherwise the entire card may be suspended. We have done a lot of work in this regard, so the overall consumption limit is very high and the card consumption categories are relatively wide. I can't say that it covers everything, but if you find that we don't support a certain category, it will be online in about two days.

Other users reported that some users hope to use it in China. Our project is mainly overseas, in the United States, but our user base also includes Asian users. We do not support many domestic usage methods yet, such as WeChat, but we support Alipay, and WeChat is still under consideration. Another example is ATM withdrawals, which may not be in great demand in China, but are in great demand in the United States, because many places only accept cash or have discounts for cash. ATM withdrawals are very important here, and we can do it.

The other thing is that the rules are relatively simple. For users, there is no need to charge today and what will happen tomorrow. Overall, the simpler the better.

Star: I understand. To sum it up, if you want to pay, you can pay.

Chaz: Let me add one more thing. In terms of pain points, the card thing is actually a large account that supports many small retail accounts, so we will take this into consideration when we do it. We must support many things that large accounts want to do, and many whale users want to do. For whale users, we can even do a lot of customization. For example, if you have a need today, just contact me directly, and I can launch it for you in one to two days. It may not be available to everyone, but it may be faster for large accounts.

Crystal: Chaz has explained it very comprehensively. The most important scenario is to pay with Crypto. Why pay with Crypto? Some of our friends and colleagues may have a salary of USD, and for them, this card is an essential tool in their daily life.

We have different card products in different places, with different mechanisms, forms or regions, and each card has different spending limits in different regions. The princess also mentioned at the beginning that the transaction fee of a European card may be cheaper than that of a US dollar card, or this card is good in Europe, but the cost for users in other places is much higher. I think the biggest pain point and gap at present is that in order to make the card more useful, we still rely on a global clearing network like Mastercard. If you rely on this global network, many things must meet their requirements. I don't want to talk about compliance, but it must meet the requirements.

Your Mastercard can be used anywhere, but we still want to do a lot to break through the limitations, such as higher limits, better benefits, and more favorable handling fees. But we will definitely have a creative solution to solve the cost problem, giving users lower handling fees, or allowing users to pay in more places outside of Mastercard or the clearing network we will access in the future. So the main pain point at present is the limitations of traditional banks or traditional cards that I mentioned above, and we hope to find a way to break through as soon as possible.

Princess Christine : Chaz mentioned large-amount payments, which is indeed a pain point. According to our current tests, we can swipe 100,000 U in a single transaction. At that time, a friend should have bought jewelry and diamonds. But I have never tried swiping a Ferrari in a single transaction. This may be related to the other party's acquiring institution. Can the acquiring institution accept such a large amount of foreign card payment for such an expensive product? So sometimes everyone needs to understand that the payment industry has both payment and collection. Many times, the problem is not in payment, but in collection. For example, some UnionPay International may not be willing to accept your payment, so you cannot pay it out.

Having a physical card can solve this problem. Infini currently has no restrictions on user spending. As long as the user has money and the acquiring institution can accept it, we can pay it out. We don't have any limits. But there is a feature in our product. Because many users are afraid of fraudulent use, users can set a daily limit in the system. For example, if you are worried about the card being stolen, you can limit the limit to 500 yuan on the day, and the maximum loss is 500 yuan. Infini cards can be frozen and deleted at any time with one click. Once stolen, risk control can be quickly carried out. This is also a security requirement.

The third pain point is that many users want to open cards for their family members. I often see the demand for opening family cards or supplementary cards for parents or partners. We can also support this here. As long as you have money in your account, one KYC account can open up to five cards, which can be used for company employees or relatives, and you can see their consumption at the same time. I often say that if you love him, give him an Infini supplementary card so that you can know what he does every day. This is also a very interesting demand of users.

Star: I am particularly curious, why do some whale not go off-ramp (withdraw fiat currency) but use cards?

Chaz: It is like this. Maybe many friends do not feel deeply about this, but I personally feel it deeply because I live in the United States. If I sell Crypto and exchange it for US dollars, I have to pay taxes, usually between 35% and 40%. Suppose (although it is not true, I actually lost money), I made 100,000 US dollars on Crypto today. If I exchange U for US dollars and put it in my bank account and do an off-ramp, I can only receive more than 60,000, and more than 30,000 is gone, and it is handed over to the government. This is a strong demand at least in the United States.

If my Crypto assets are not converted into US dollars, I do not need to pay taxes under the current legal framework. So I have a strong motivation to spend the U earned from various transactions directly in real life. Why does the current card format allow you not to pay taxes? Because essentially, you deposit U into the card, it is a debit card, not a credit card. There is an acceptor at the bottom, which receives your U and pays the US dollars. You can think of it as a loan operation: you give him U as collateral, he helps you pay the US dollars, there is a loan relationship in the middle, and at the same time he makes an acceptance, so he charges you a little fee. Under this framework, no one needs to pay taxes because it is not part of your income. This is why we think this thing is very reasonable.

Let me add one more thing. One point that was not mentioned just now is, why do we want to make cards? The logic behind the card itself is the stablecoin. We think the stablecoin track will definitely be bigger, because the stablecoin is backed by US debt. No matter how many stablecoins you issue, most of the US dollars (the US dollars backed by your stablecoins) will flow into US debt. This is particularly good for the US government, which wants to ensure a strong dollar, so no matter whether it is Trump now or who is behind him, he will support this. Because this way they can sell a lot of debt, and the US government also has a lot of money to spend, so the stablecoin track will definitely get bigger and bigger, and the stablecoin payment track will definitely get bigger and bigger.

Which company can occupy the high ground of stablecoin payment? This will bring very good development. If you look at Stripe, it acquired Bridge.xyz a few months ago to do the stablecoin payment track. It is definitely the leader. Including if you look at Venmo and PayPal, they are all doing this. They are traditional payment companies that have turned to stablecoins as a new payment method. We certainly can't compete with these giants. We can only think of other ways, such as whether we can make a set of credit card-like logic from more daily consumption. At present, we first lower the fee rate and expand the consumer categories, which allows you to do many things. It will be easy to add functions to this card later. If you spend so much today, I will give you some additional membership rights, or we can divide the card into different levels later. This is the logic.

5. Can U Card be compared with credit cards?

Star: I have collected a lot of questions from friends, one of which is, can U cards be comparable to credit cards? We know that credit cards can be prepaid and have a lot of benefits. But now U cards have to be charged into the U card, and some of them cannot be withdrawn after charging, which is a bit troublesome, and the benefits may not be as good as credit cards. What can you share about this?

Crystal: Let me answer first. To some extent, it is impossible to compare. Imagine why it is so troublesome to apply for a traditional credit card? You have to do the so-called "KYC" and provide personal information to let the bank investigate your background, because they want to prevent you from being unable to repay.

We really want to do it, why? First, so that users can have more flexible use of funds, such as using loans. Many exchanges have loans, or many projects have loan models, which can be used as collateral. Second, at present, without collateral, we still hope that users have flexible funds for other transactions or activities. So in order to avoid too many risks of non-repayment, our current model is only to process it by debit card, so there are limitations and risks. Of course, we can use many innovative models to solve it, and we are also working hard.

So for us, the lack of a credit card model may not only be a problem for users, but also for us, because users can use as much as they want, and we ourselves would like to collect interest, but because it is a debit card model, we do not have this income at present. The reason why traditional credit cards can provide so many benefits is largely because they collect interest and have a high source of income. It may be that users are unable to repay or pay high interest, and the income they get can be returned to users to make more discounts. We are also reflecting on this matter. Of course, we cannot give users rights and interests in such a direct way as traditional finance, but back to the point issue discussed at the beginning, why do users use your product? Of course, it is because the product is good enough, or your platform has enough leverage or endorsement, so that users like to use your U card. So we are also working hard. There are more and more cryptocurrency users and more and more cryptocurrency cards. We also know that the market competition is fierce, and we still have to roll when it is time. So we now have automatic cash back of points, points mall, and even launched VIP room vouchers, which can be redeemed with points. We hope that although part of the cryptocurrency card is encrypted or virtual mode, when ordinary users still have Web2 or real life needs, we can provide them with rights and interests that they recognize, know or feel in real life.

Star: Indeed, there is still some distance between prepaid cards and credit cards. Let's hear your thoughts on this.

Princess Christine: I think we can have some blockchain-specific solutions. For example, the APR for traditional finance is relatively low. If you deposit money in a fixed or demand account at a US bank, the interest rate is basically below 2%. But in blockchain, it is easy to get relatively high and relatively stable returns. So I think we can present the benefits of traditional credit cards in the form of Yield or Earning, which is a reverse cashback for users.

Cashback is essentially a way of taking the wool from the sheep. If your credit card is overdue, as Crystal said, they make money from your overdue payment, and then they return it to you when you spend money. If we don't have credit loans, we can make money from the blockchain Beta and give it back to users. This is actually a core product of Infini. When we Brainstormed this model last year, we were the first in the market. At that time, we didn't want to make cards. We thought that traditional returns were so poor, is it possible to turn Crypto's returns into something that ordinary people can access? This is the logic behind Infini's earliest Brainstorm. Later, this model was recognized, and we can see that many similar models are being promoted, which shows that we are on the right track, that is, trying to use blockchain features to solve user needs, rather than simply copying the gameplay of Web2. For example, if users like Cashback, then we can package this business as Cashback. This is just a change of words.

In fact, the money of users is returned to them in some form. I often think about credit card benefits. Many users of Infini like to ask me about benefits every day and ask me to give out benefits every day. I want to solve it with blockchain characteristics as much as possible. For example, we cooperate with project parties such as MegaETH and GM Network. As long as they are high-quality users of Infini, we will give them some whitelist or Alpha opportunities.

I think this is also very interesting, because Infini users are real people who swipe their cards, not addresses on the chain. Some addresses on the chain are mass-produced, but the consumption behavior and image of each Infini user are real. So when the project party airdrops to Infini users, they airdrop to real people, which has a demand for attracting new users for the project party, because many project parties hope to find real users with consumption power to join their ecosystem. So one of our very important growth engines is also cooperation with the B-side. Next, we will also cooperate with many public chains such as Monad, because public chains also hope to capture users from us, so we are a mutually beneficial process. This is also one of the solutions with blockchain characteristics. In the future, I will continue to airdrop benefits provided to us by other project parties to users, especially high-quality, real users.

We have already issued a whitelist of MegaETH. At that time, one whitelisted user received about 1,000 U off-site, and also issued a GM Network bracelet. We are also discussing more benefits for everyone. For us, users get high-quality benefits; for the other party, they get high-quality users. So Infini can be understood as a new type of customer acquisition platform. We build excellent user data through user consumption behavior, and then give it to the project party that wants to capture these users. This is my thinking on this matter.

Star: This is interesting, the rights and interests of the crypto are not exactly the same as Web2 credit cards. Chaz, do you have any ideas?

Chaz: I think the two previous speakers have already spoken very well. Let me talk about it briefly. First, I will continue with the rights and interests mentioned by the princess. I think it is very reasonable. As a Crypto user, since you have decided to open a Crypto card, you are going for something more original, and this thing has higher potential returns. To put it bluntly, it is a variety of airdrops for you. When we talked just now, we also mentioned that one of the means of attracting new users is to give users the expectation of airdrops. Our Season 1 airdrop has ended, and there is still Season 2 to come, including many projects on our chain. Card users are definitely high-quality users, which is the same logic as the princess proposed.

This thing is actually very similar to Solana Mobile. Why do you want to buy that phone? Do you really need that $500 phone? No. What you may want is that all the project parties on Solana regard the Solana Mobile user group as a very high-quality user group, because you really spent $500 on this and did it very early, so they think you may be a high-quality user and want to pull you up. The logic is the same.

Secondly, the friends talked about why the overall benefits of U cards are relatively low now? Crystal also talked about that the wool comes from the sheep. Traditional credit cards first have to pay a card opening fee and an annual fee every year. Today I ask you to charge an annual fee for a Crypto card, you may not want to, because there are too many Crypto card companies. Especially many are in the early stages of entrepreneurship, like us, we are also in the early stages. If you pay me an annual fee today, you don’t know if the project will still be there next year. I’m not talking about our project, I’m talking about some small card issuers in Dubai and South Korea, you are not assured of paying the annual fee.

Secondly, you have to calculate when you pay the annual fee. For example, if you open a Marriott credit card today and pay a few hundred dollars in annual fees, you have to calculate how you earn it back. You can't figure this out in Crypto now. I can tell you that I will give you an airdrop, but I can't promise you how much money you can give. Secondly, I can give you benefits, but if you calculate this benefit, it is definitely not comparable to traditional credit card companies.

This is why I think that overall, the competition has not yet reached that stage, and user habits have not yet reached that stage. I think it is still in a relatively early stage of educating users and educating the market. When it is true that 99% of the audience in our chat today have their own U card, and even more than 50% of people in most Crypto circles have their own U card, then I think it is time to talk about more benefits, and then it is time to talk about more annual fees, cashback, and membership rights. At that time, these discussions may be more. Now it is still in a stage where simplicity, low fees, and security are more important overall, and the market has not yet competed to these later stages. I personally feel that it is still relatively early, so there are actually many things that can be done in this track.

6. Why did the number of U cards surge during this period? The impact of Visa/Mastercard’s entry

Star: The next question I'm curious about is that U cards are actually available in every cycle, why are there so many in this cycle? We also know that there are news reports that Visa and Mastercard have also joined the battle and will soon support payment with U. This is what everyone wants to hear about.

Crystal: OK, let me share some thoughts. Why are there more and more different projects and exchanges joining the fray recently? The most basic reason is that more and more people are trading. For example, when Wall Street can even include buying Bitcoin in ETFs, the adoption rate of Crypto is a great opportunity for our trading platform and exchange. As long as we can get users interested in acquiring customers, that is the key to growth for us.

Secondly, Crypto payment can solve many problems of traditional finance. I have lived in many different countries. For example, if I want to send money back to Taiwan, I don’t know how to handle it. There may be compliance issues, and my account may be locked, etc. So I think first of all, the trading market is booming, there are many project parties, and both of you are very good entrepreneurs and contributors in this field. We all hope to seize this opportunity to better understand user needs and provide corresponding services.

Moreover, this is the general trend. We must use PayFi or Fintech to change the original payment problems. So major companies, such as Mastercard, Stripe, Visa, and governments are all promoting stablecoins, DeFi Payable things, stablecoins or various Crypto Payments. So I think now is a good era, and various stakeholders, whether companies, governments or project parties, are coming out to do this. This is my own opinion, and I see the reason why these current ecosystems are booming.

Star: I agree very much. There are so many stablecoins in this round. Basically, every project wants to promote its own payment or combine it with payment. Let's hear your thoughts on this.

Princess Christine: Crystal talked about the internal reasons why U cards are so popular in this cycle. Let me talk about the external reasons. I think the external reason is that there is nothing to do in this cycle. Many tracks have been falsified, so everyone tries to "move from the virtual to the real" and look for tracks that have not been falsified. Most of these tracks that have not been falsified have PMF and income.

As a track with actual income, everyone has become interested in U Card. Now you will find that many project parties have started to make U Cards. Those who used to do Staking, asset management, and exchanges are basically all doing U Cards. This is because there are too few things that can be done in this industry at this moment, except for other things, so everyone says that it is better to do payment and see if there is anything that can be tossed.

But in this cycle, the narrative may be different in half a year, and new things will come out at that time, because the narrative of the crypto is iterating very quickly. We can go from NFT to blockchain games, to the explosion of public chain Layer2, to Meme Coin Launchpad, to inscriptions, etc. How many narratives have we experienced in the past two years? So the U card thing may not necessarily remain popular for such a long time, but it is still okay as a business itself. So I think this is an exogenous reason, that is to say, it is a good thing that this industry is gradually moving from "virtual to real".

Star: That's very honest. Let's hear what Chaz thinks about this.

Chaz: Okay, I think both of you have spoken very well. It is true that in this cycle of the crypto, there may be less that the project side can do. Let me share with you from another perspective. I think the previous two perspectives are already very good, so let me change the way.

As I mentioned earlier, I think this is a long-term trend. Why? If you look at it from a long-term perspective, it is actually one of the steps for on-chain finance (on-chain finance represented by DeFi) to challenge traditional finance. Back to the most basic things, why did I mention that I think stablecoins will become bigger and bigger and will be very powerful? Because it is inherently very good for the US dollar. It is actually a new dollar on the chain. And it is a new dollar on the chain that is recognized worldwide.

A few days ago, I saw that the market value of USDT is already very high, and people all over the world are paying for it. When you exchange various fiat currencies from various places for U, they are essentially exchanged for US dollars, and then given to the acceptor of these U, and then he gives you U, and then he uses the US dollars to buy treasury bonds. So this is a particularly good thing for the US government, so this matter will definitely be strongly supported from the government's perspective. It's just that Trump's government has moved faster, and he strongly supports the entire Crypto industry, including the stablecoin industry, which means that obstacles have been cleared for supervision from the government's perspective.

That’s why you see so many big companies lining up to enter the market in this cycle, because these people have actually wanted to enter the market for a long time, and everyone is eyeing the big piece of cake of Crypto payment. It was difficult for them to enter before, why? Because the policy uncertainty is too high. For example, if I invest hundreds of millions or billions of dollars to do this today, and the government cuts off my business tomorrow, it may be a huge loss for these people, and the loss is too big. So this is why you mentioned Visa, Mastercard, including Stripe, PayPal, Venmo, these payment companies are doing this, in fact, it is mainly because the first market is in place in the macro sense, the entire volume is large enough, they have something to play with, and they have money to make. Second, the last step of the policy barrier has been cleared.

The government has clearly stated that it supports this matter, so you don't have to worry too much about other things. From this perspective, big companies can line up to enter the market. From another perspective, similar products made by these big companies in the Crypto industry are basically out of the question, and you can't beat them. They have government support, traditional business support, and a large scale, so they basically have nothing to do. So as a startup team, what can you do? You can only issue cards. Because even in the Web2 industry, cards are everywhere, and anyone can issue a card as long as you can provide users with enough rights and interests. This is why I think this is reasonable from a more macro perspective.

7. Relationship between U Card and PayFi

Star: Yes, I think everything follows a big cycle. In this cycle, everyone wants to make stablecoins and also wants to make payments. It’s a good opportunity to talk about the relationship between U Card and PayFi. Because Princess and Crystal just talked about that the card itself can generate a lot of yield for users, and the yield itself is a feature of the crypto or a reward for users. U Card combines these two together. I want to hear everyone’s thoughts on this. Let’s start with Crystal.

Crystal: I really need to learn more from the other two, because our Bybit Card is still a more traditional model, which means that we may use legal currency for settlement in some areas. So it may be less flexible in the entire settlement cycle. But I believe in the PayFi route. First of all, it can go on-chain, or connect on-chain to off-chain, making the entire settlement process and user experience smoother, and it can also reduce a lot of costs.

Therefore, U Card and PayFi should have a symbiotic relationship. U Card itself is a consumer product. Our product already exists, but it has many problems. The user experience is not bad, but our subsequent operations, whether it is operation or expansion, can be better integrated with the platform, and can actually empower each other. So I also want to learn from the other two, what are your views in this regard?

Princess Christine: I think to answer this question, we must first think about what PayFi is. We have GameFi and DeFi, so what does this Fi really mean? So sometimes I think that Fi is a kind of incentive. If a game does not issue coins and is simply fun, it is not called GameFi, it is called Game. I think the source of Fi in PayFi also comes from this incentive part.

But for Infini, whether it is PayFi or Pay, our focus is actually on Pay. Because I think the core of a good product is to develop its most important product function. So I think Fi is a means of growth, and Pay is the cornerstone of existence. This is my understanding of Pay and PayFi.

Chaz: I don’t have much to add. Payment is the basis, and then you can derive other ways of playing on it. It’s what Princess and Crystal said.

8. How to choose the most suitable USB card: precautions and pitfalls

Star: Let's talk about a more practical issue. When a user chooses and uses a U card, how can he find the one that suits him best? Are there any precautions or pitfalls to avoid?

Crystal: I want to quote what the princess said at the beginning. In fact, each company must say that what we provide, such as payment currency, settlement currency, and some other things such as whether KYC is required, what information and materials need to be provided when applying for a card, where you can pay in the end, whether the merchant will refuse you, and even the subsequent derived handling fees. Each company may provide different products for various reasons. So in the same way, how do you choose your own U card? I think there are actually quite a lot of online, and we ourselves often pay attention to who has released what, and there will be multiple comparison tables.

For me, as a user, I think the most important thing is the application qualification and the calculation of the handling fee. Sometimes, to be honest, the calculation of the handling fee is very hard for companies like Bybit Card. Although we actually charge overseas handling fees and selling fees in the handling fee calculation, we will give users some points to give back, which you can also consider. You can base it on your usual consumption habits and methods, or see if there is any so-called special feedback for a certain merchant in the scenarios you are used to using. For example, we currently provide 100% cashback for AI tools (ChatGPT, Midjourney, etc.). If you really like a certain merchant and like to use it, you can also consider which card supports more. I look at this from a very consumer perspective.

Princess Christine : OK, let me say something too. I think Crystal said it very well. In fact, it was what I said at the beginning. Everyone should think clearly about the usage scenarios of their cards. In order to cope with different consumption scenarios, we opened two cards: one is called Global Pass and the other is called Subscription Card. Because now there are many Crypto Nomads who need to pay for some tools, and these tools are more subscriptions. Some general cards do not do a good job in supporting this kind of subscription service. For example, ChatGPT is prone to payment failure. So we specially launched a subscription card to meet the common needs of developers or the Crypto Nomad community.

The Global Card can accept all payment methods such as Line Pay, Apple Pay, Google Pay, WeChat, Alipay, etc. However, it may not be very good at paying for special subscription services, so we have made a small distinction in terms of product needs.

Infini will also launch more cards in the future, because we are essentially a card aggregator, and we will select some cards with the best rates according to different scenarios and countries. For example, if you use our Global Card now, it will have a transfer fee, and we have also written this transfer fee on the official website. Because this card is a Global Card, it may have some conversion fees in the rate. But if we go to the Latin American market or the European market, we may launch some local cards, Latin American cards or European cards to better meet the payment needs of local people. So in the future, we will also be looking for different high-quality cards every day and give them to our global users.

I think the card selection depends on your usage scenario. There are many cards now. Please remember that all cards will have some conversion fees as long as they consume foreign currency. Where does this conversion fee come from? When you pay dollars to the bank, the bank needs to convert dollars into Vietnamese dong, and there will be a small rate difference. The exchange rate difference is called the conversion fee. Basically, all cards will have a little bit of conversion fee when used in foreign countries, but if it is a local card, there will be no such problem. For example, there is basically no conversion fee for European cards to consume euros. So everyone must pay attention to choosing the local currency of the corresponding card. I think this is a very important thing. People often ask me if it is possible to issue a RMB card? I think you should forget about it. It is basically impossible. No project party can issue you a UnionPay RMB card. Unless the project party does not want to do it well. So as for the RMB card, because we are Chinese Space today, I would say that the RMB card is out of reach.

Chaz: I think there is another indicator that you can look at, which is where you usually keep your money. If you mainly keep your money in exchanges, then you might as well open an exchange card. Of course, I think the above usage scenarios are at the top of the list, and you still have to see which place you usually spend your money on is the best for you. The second is what I said, that is, if you usually keep your money in exchanges, then you should open an exchange card, because it is the most convenient for you. If you usually keep your money on the chain, you can choose more other options, such as the Infini card, or even our Solayer card.

As for other possibilities, I think both of you have explained it very well. The most important thing is the consumption scenario, and then the location where you usually store your funds. I can't think of too many other places for now.

Then it's up to you to get used to it. If you live in mainland China and you use Alipay or WeChat, then you'd better choose a card that can be linked to these. If you are often overseas and need to swipe a physical card, then you can just look for a provider that provides physical cards. Finally, my mainland KYC students can try it. We should have opened it recently. We have cancelled the Waiting List. Before, you needed an invitation code, but now it should not be necessary.

Star: I would like to ask, why is the Solayer card opening fee so expensive?

Chaz: Hahaha, how can I explain the reasons? First, I need to give benefits to our early users. It’s free for our early users, especially those who participated in the Pre-sale. This means that they don’t have to spend the money, which is a benefit for them. Secondly, there are some costs that I need to cover. Also, it has a potential marketing tool. I can’t increase it, but I can always reduce it. If you increase it, it will be weird and many people will scold you, but if you reduce it, wow, it’s great, it’s cheaper, and it’s great.

9. Legal and Compliance Risks

Star: There is another question that some of our community partners are particularly concerned about. The first one is whether there are any legal risks in using U Card?

Chaz: It depends on the region, as long as you can. My understanding may not be that deep. I hope the other two can add to it, especially in the mainland. My personal understanding is that there is not much. Why? Because when you actually spend it, the payer will not bother you, because you opened a card with him, he makes money, why should he bother you? Secondly, the payee does not know that you spend it in this way. The payee only sees that the acceptor in the middle gave him RMB. He does not know what kind of relationship you have with the acceptor. This is my personal understanding.

Crystal: Yes, I understand legal risks, which is a more serious topic. We have not observed or seen such cases so far. At most, some larger acquiring platforms, such as Zhishen or Weishen, may know that it is a U card. If they have a way to know, they will at most ban or block it, but that's it. So I don't have any legal risks yet. I dare not say whether there are or not, because I am not a legal expert, nor a talent in this area. But at least for now, some of the products, competitors or peers we have heard about are still within a safe range. But it is possible that merchants may find or do not support this situation.

Star: Does the princess have anything to add?

Princess Christine: No, there is definitely no such thing in the mainland. Because Chaz just said that from the user's point of view, from the point of view of the acquiring institution, you just paid him a sum of money, and your card is the same as the card issued by JP Morgan Chase in the United States. So of course there is no risk in using this card, please rest assured.

Star: Yes, and there is another saying, which may also be a rumor, that is, if the money in the U card is transferred back to the exchange, it may cause the exchange to freeze the account. Is this possible?

Princess Christine: I think so. This problem may be related to some historical projects. Because many U cards are used by people to store their money on the U card platform, which is a bit like a currency mixer to some extent. So when you charge the money from the U card and then withdraw it, it is not your U card, but someone else's U card, and you have touched the transaction.

So anti-money laundering and KYC are very important. We spent a lot of effort in the beginning to research how to do KYC well, because we are afraid that others will charge black U and pollute our pool. Now we are also working with Cobo to do this. But I do know that there are some smaller U card service providers who do not do KYC well, which will lead to the U charged by users being reported as black U, which is indeed a possible problem.

Star: Yes, so for users, when choosing a U card, they should really choose something very formal and brand-backed.

Princess Christine: Yes, don’t be greedy for such small gains.

10. The future of U card

Star: Let's talk about a lighter topic. I remember you talked about it just now, that is, the U card may be a temporary thing. But what will it look like in the future? How do you think about this issue?

Crystal: Let us briefly talk about Bybit Card. Although we call it Card, you may have noticed that we recently launched a product called Bybit Pay. We are also thinking about its product prototype. For example, in Latin America or some emerging countries, such as Vietnam, India, and some Latin American countries, they actually prefer to pay with mobile phone codes or QR Codes.

In this scenario, the penetration rate of cards may not be high in that country or region. So we don’t want to limit ourselves to cards, because when people think of cards, they may think of Mastercard. You must have a acquiring and clearing agency to support you, which actually limits us. So what we want to do is to expand, that is, we can enable users to pay, or when users need to pay, we can support them, which can be to smoothly spend their U to buy a bottle of Coke, or buy a piece of clothing.

So we have already connected to the local Pix in Brazil, which is their National QR Code network. The penetration rate is very high, and users can easily make payments with merchants, do internal transfers, and P2P transfers. So what do I think about the future form of the U card? Of course, there are many ways to play. It is related to credit cards, DeFi or e-commerce transactions, or we do staking. We may give users some current financial management or staking benefits.

But what I want to mention more is that we have been studying how to break the limitations of cards and payments to solve the payment problem. In this way, as long as there is a way to pay in the world, as long as money is needed, our tentacles can be extended. So this is our imagination of the future of U Card. It is not just a card, but it is a boundless payment method.

Star: So essentially, we still hope to enter the big payment market. What about Chaz?

Chaz: Yes, my idea is that the U card is essentially an intermediate product. Many of the things we are doing now are trying to connect the money on the chain with the consumption off the chain. This is unreasonable in the long run. In the long run, it should be said that the money on the chain can be spent directly off the chain, which is reasonable. Why can't merchants accept U? Why do you make us transfer it back and forth? There are many costs in the middle. If you think that any party in the middle, the acceptor and the card issuer, must make money, then it is a cost for users. In the long run, it must be said that all merchants accept U, which I think is difficult to do. If it wants to be big and really popular, it can only be done by large institutions such as Visa and Mastercard. That is to say, my card can accept U today, you can deposit U, and then when you spend money, they will directly find Circle or Tether from Visa and Mastercard to do it for you in one step, and then they will directly give the fiat currency to the merchant.

So the final outcome must be like this. When it reaches that stage, the properties of each U card will change. It has no off-ramp, no offline competitive differences. It can only be said that who has better benefits, who is better at acquiring customers, whose card is more beautiful and cooler, or who is tied to other business ecosystems and can bring users more benefits in this ecosystem. Its competitive landscape will change, and I think this will actually happen faster than everyone thinks. I think this will most likely come true during Trump's term. So it is possible that the entire card competition landscape will change, and it will really be more like the traditional credit card competition landscape, because the offline thing that you originally relied on may no longer exist. The entire way of playing will also be different. This is how I understand this matter.

Star: Yes, I think a lot of things will happen during Trump's term, that is, there will be many merchants who want to accept U.S. dollars. I think it is much better for merchants in third world countries to accept U.S. dollars than their own currencies.

Chaz: Yes, yes, it is true that what you said is quite right, that is, it may start from some regions first, and then slowly spread to other places. But I think that some small countries and regions are still not big enough. They may do some exploratory work, but to really scale up, it may still require some large institutions to enter the market and make this happen.

Star: Let’s hear what the princess thinks about this.

Princess Christine: I think everyone has said it very well. I don't have anything special to add. I think it can be mapped to the development of Web2. Because China actually skipped the credit card stage. People may have directly started with paper money, then went through a short period of card stage, and then directly to WeChat and Alipay. But in the United States, it is actually different, because in the United States, payment is not as convenient as in China. Most of the time, credit cards and Apple Pay are more used. In addition, there are many POS machines in the United States, and cash is used in many places.

In fact, in terms of payment, I think China is actually very advanced. Maybe in the future, as Crystal just said, you can just scan the code and pay directly. There is no need to go through this card, which acts as an intermediary to make a conversion. We may have our own network. What is this network? I don't know. I think it may be Tron or some payment networks that have a very large user base in payment, but it is indeed. Well, I think the credit card industry is a semi-finished product, and it is definitely not the end.

Chaz: I would like to add to what you said. I particularly agree with you on this point. First of all, it is definitely not the end. Secondly, I think it is difficult to change consumer habits. I even think that in Europe and the United States, cards will definitely be the mainstream for a long time to come. But in Asia, especially in China, cards may be a phased thing. After a while, when everyone can really use U cards, this thing may disappear.

Because I live here, I found that they also have products similar to Alipay, but they can't get off the ground, because there is no volume. It's because everyone is used to this, whether it's consumers, merchants, or middlemen, the overall profit chain is too huge, and it's difficult to interrupt it. So I think it's likely that even if stablecoins are a new payment category, they will join the current system in an integrated manner. So I think especially like Crystal Bybit, this European card, and Infini's US dollar card, and our US dollar card, I think there are still great opportunities to do it in these countries and regions in the future.

Star: Yes, I agree. It is true that the consumption habits of users in different places are different. Some people may think that it is very convenient to scan the code in China. Some people may think that it is very convenient to take the subway or bus in Singapore, the United States, or Hong Kong by swiping a card. So I think the core is to meet the payment needs in the end. We have been chatting for almost an hour and a half. Let's see if these three guests have anything to add. I think the speeches are really wonderful and thoughtful. If there are no more questions, then our Space today ends here. Thank you to the three guests.

Crystal: Thank you. Thank you.

Chaz: Thanks for organizing.

Princess Christine: Thank you Star. Great. Bye.