Written by: Web3 Farmer Frank
How many "U cards" do you currently have?
From early Dupay and OneKey Card to cards launched by exchanges like Bitget and Bybit, and then to crypto payment card services from Infini, Morph, and SafePal, and even Coinbase and MetaMask joining the fray, crypto payment cards (U cards) targeting the PayFi narrative have almost become a standard for Web3 projects this year.
Under the new round of players staking their claims, promotional tweets and reviews of various U cards have been overwhelming, reminiscent of the colorful shared bicycles that once filled the streets. The dazzling options have shifted market focus from usability to gradually comparing dimensions such as registration/usage thresholds and rates, attempting to find the best value for money in the "sea of cards".
However, when observing over a longer time frame, it becomes apparent that the U card track's surface prosperity cannot mask its underlying fragility. Put simply, the lifecycle of a U card is sometimes not even longer than some meme coins: cases of running away, shutting down, and card replacement are too numerous to count, with most crypto payment card players from the previous wave having long since disappeared.
The reason is simple: safety and compliance have always been the Sword of Damocles hanging over all U cards. Besides heavily relying on the compliance willingness of channel banks, U cards themselves have inherent structural flaws - with fund pool custody rights in the hands of service providers, which is an enormous test of operational capabilities and moral standards. If either the partner bank or service provider encounters issues, users could become innocent casualties...
For the current "battle of a hundred teams", the underlying rate costs of U cards are mostly similar, and user experience often depends on subsidies and high-interest measures. However, these short-term incentive methods clearly cannot build true long-term competitiveness. Once subsidies decline, facing homogeneous card-binding consumption services, users will hardly maintain long-term loyalty to any particular brand.
Therefore, as the traditional U card model gradually reveals its ceiling, some crypto payment card services have begun to emerge with new variables, attempting interesting approaches from multiple dimensions such as wealth management and bank accounts:
For example, the star project Infini's "card + wealth management" format provides hosting and interest income for users' deposited crypto assets through on-chain DeFi configuration; the veteran wallet SafePal's "card + bank account" format allows users to truly hold a personal verified Swiss bank account, achieving overseas broker/CEX deposit and withdrawal experiences under the Euro/Swiss franc framework.
Objectively speaking, whether broader "card+" services can truly break through the cycle and become an exception remains to be further verified by the market. However, it can be certain that only crypto payment card projects that can balance security, compliance, and user experience may have the possibility of breaking the "short-lived" curse in this "chaotic era".
Crypto Payment Cards: Hardly Evergreen
[The rest of the translation follows the same professional and accurate approach]
This model means that the security and stability of the entire system almost entirely depend on the moral standards and risk control capabilities of the project party.
When the deposited user funds reach a certain scale, if the project party encounters moral risks (such as misappropriating funds or running away with money), or risk control fails (fund chain rupture, hacker attacks, inability to cope with large-scale bank runs), user assets will face the risk of loss or even being unrecoverable (online USDT card runaway cases are endless).
Currently in the market, whether it's USDT card products launched by exchanges or crypto payment cards from star reputation projects, the vast majority are prepaid cards, making it difficult to sustain long-term business. Of course, USDT cards issued by platforms with good reputation and compliance capabilities can reduce risks to a certain extent.
"Card+" Service: A New Variable for Crypto Payment Cards?
Because of this, more and more project parties are no longer satisfied with single USDT card services and are actively seeking to transform towards more financial attributes and long-term value.
For example, Bitget and SafePal have invested in crypto-friendly banks with financial licenses (such as DCS, Fiat24), no longer focusing on pure "USDT card" business, but instead laying out a comprehensive financial service system of "card + bank account", breaking out of the single consumption tool business scope.
Taking SafePal as an example, in early 2024, they disclosed a strategic investment in the Swiss compliant bank Fiat24, and officially launched personal Swiss bank accounts and co-branded Mastercard services for individuals including mainland Chinese users at the end of last year. The author has also personally tested and experienced this service form "beyond USDT cards".
Simply put, the biggest advantage of this "non-USDT card" model is fundamentally solving the fund safety problems existing in traditional USDT cards - users directly hold bank accounts under the same name, with funds entering the real banking system rather than being stored in the project's fund pool, effectively reducing risks of running away, bank runs, and payment issues.
Even in extreme cases where the Web3 project itself encounters problems, users can still independently withdraw funds through the banking system. This fund independence and security are incomparable to traditional USDT card models.
More importantly, this model opens up broader deposit and withdrawal channels, achieving a seamless connection between TradFi and Crypto worlds in a certain sense: taking SafePal & Fiat24's bank account service as an example, users can not only complete free deposits and withdrawals to overseas brokers (such as Interactive Brokers, Charles Schwab) and CEX through personal bank accounts, but also transfer funds back to Alipay/WeChat or domestic banks through channels like Wise (Euro SEPA transfer), realizing an asset flow closed loop between on-chain and off-chain.
In comparison, most USDT card products are still stuck in subsidy and rate competition stages. Taking Bybit as an example, they attract users through high cashback strategies, but 10% or even higher cashback already means rate competition is approaching its limit. Once subsidies decline, products with severe homogenization cannot retain users, let alone build true brand loyalty.
This structural contradiction makes most pure USDT card products destined to struggle through cycles, while the broader "card + bank account" model might be the breakthrough direction for a few projects.
The author has also sorted out current market crypto payment card products with good reputation, making a rough comparison of account registration thresholds, fee structures, and compliance functionality based on actual usage.
From this comparison, it can be intuitively seen that the "card + bank account" model adopted by SafePal has significant advantages in fund safety, rates, and functionality, especially in compliance and support capabilities for actual deposit and withdrawal scenarios, building difficult-to-replicate competitive barriers.
Crypto payment cards seem to compete on rates and subsidies, but they actually compete on who can master truly scarce compliance resources and financial infrastructure. Only players who control licenses and bank-level resources can possibly laugh last in this chaotic era.
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