What is happening in the crypto card market as trading volumes hit new highs while platforms exit?

Author: Gu Yu, ChainCatcher

In the past few weeks, the Crypto Card industry has witnessed two significant events with widespread implications.

In mid-July, the Swiss payment platform Fiat24 announced the suspension of its crypto asset top-up feature and simultaneously halted new user registrations. As Fiat24 has long provided banking accounts, fiat clearing, and card issuance capabilities to wallet products, the crypto card businesses of several wallets, including SafePal, Bitget Wallet, and imToken, were immediately affected. Almost at the same time, the crypto card infrastructure platform Kulipa also announced its cessation of operations, forcing wallets like Ready and Solflare to terminate their card projects.

Looking at these events in isolation, the adjustments made by the two companies do not necessarily indicate a trend in the industry. However, when two infrastructure platforms from different segments of the Crypto Card supply chain encounter issues in quick succession, it is clear that this turmoil has transcended the operational scope of individual companies.

What is even more intriguing is that less than six months before Kulipa ceased operations, it had just completed a $6.2 million seed round financing led by Flourish Ventures and 1kx. For a startup that was still able to attract investment from top-tier institutions, announcing a halt in operations due to debt pressure just a few months later is a trajectory that clearly exceeded the expectations of many industry insiders.

Meanwhile, Fiat24 did not announce a halt to its operations but instead first closed its highest-risk crypto asset top-up feature. Although these two events manifest differently, they both reflect that the Crypto Card industry is entering a new adjustment cycle.

The Chinese Market is More Severely Affected

SafePal, Bitget Wallet, imToken, and some Asian products that previously used Kulipa's infrastructure have a large user base from the Chinese mainland, Hong Kong, and Southeast Asia. This is not a coincidence but rather a result of the market structure of the entire Crypto Card industry over the past few years.

Compared to the mature securities accounts, banking services, and electronic payment systems in Europe and the United States, the Chinese-speaking regions have consistently been one of the markets with the highest demand for stablecoin payments. For many users, crypto cards not only serve the function of daily consumption but are also important tools for converting stablecoins into fiat, cross-border payments, and capital flow, which is why Crypto Card users have long been concentrated in regions where fiat entry and exit are relatively inconvenient.

Although Fiat24 is headquartered in Switzerland, its capital and customer structure clearly leans towards the Asian market. Public information shows that its investors include Asia-Pacific investment institutions such as HashKey Capital, LIF, and Redpoint China Ventures, while its partner wallets mainly include Bitget Wallet and imToken, which have strong Chinese-speaking backgrounds. This means that while Fiat24's business focus is built on the European financial system, a significant portion of its trading volume actually comes from Asian users.

Therefore, when Fiat24 suspended its crypto top-up service, it was naturally the Chinese-speaking market that was most severely impacted.

At the same time, several users have recently reported on the X platform that some U cards can no longer be bound to or used with WeChat Pay. Although WeChat Pay has not publicly explained the reason, and it cannot be concluded that there is a unified policy adjustment, this change at least indicates that the pressure faced by crypto cards is no longer limited to issuing institutions but is beginning to extend to payment channels. When issuing institutions, partner banks, and payment channels simultaneously raise their risk control standards, the user experience of Crypto Cards in the Chinese-speaking market is inevitably affected.

Crypto Cards Are Not a Light Asset Business

In recent years, the impression of Crypto Cards has often been that "wallets have added a bank card," but those who have actually operated related businesses know that this is one of the heaviest infrastructures in Web3.

A Crypto Card requires multiple steps from user application to final payment, involving wallets, issuing platforms, BIN sponsors, partner banks, Visa or Mastercard networks, acquiring institutions, and more. For users, it may seem like just a card swipe during consumption; however, for platforms, each transaction is accompanied by a series of complex processes including fiat conversion, bank clearing, anti-money laundering reviews, risk control monitoring, and payment authorization.

This means that the operational costs of Crypto Cards are significantly higher than those of ordinary internet products.

Platforms not only need to bear costs associated with bank partnerships, international card organization fees, KYC and AML review costs, but also need to maintain ongoing investments in global customer service, risk control, and compliance teams. Meanwhile, their sources of income are relatively limited, primarily relying on card transaction fee sharing, foreign exchange conversion profits, stablecoin conversion fees, and membership service income.

When the market is growing rapidly, this model can still rely on user scale and financing support; however, as the industry enters a phase of stock competition, high fixed costs begin to rapidly erode profit margins. For startups with limited scale, even obtaining financing may not be enough to support long-term operations.

Kulipa's experience is a typical case. Financing addresses short-term cash flow but cannot change the fact that the card issuance business is heavily reliant on operations, compliance, and capital investment. When transaction volumes cannot continuously cover costs, platforms ultimately face the reality of their business model.

At the same time, the regulatory environment is also changing.

With the formal implementation of the European MiCA regulation, the ongoing advancement of the Travel Rule, and global banks continuously strengthening anti-money laundering and source of funds reviews, crypto asset top-ups have gradually become the highest-risk link in the entire payment chain. Therefore, compared to directly halting card services, suspending crypto top-ups often becomes the preferred choice for issuing platforms to control risks, which is also an important background for Fiat24's initial adjustment of its crypto top-up business.

Crypto Cards may seem like just a bank card, but in reality, they are one of the heaviest infrastructures in Web3.

The Industry Is Not Cooling Down but Concentrating Towards the Leaders

If one only looks at the events surrounding Fiat24 and Kulipa, it is easy to conclude that the Crypto Card industry is beginning to cool down. However, data from Paymentscan presents a different picture.

According to the data, since the end of 2023, the monthly consumption scale of Crypto Cards has almost maintained a one-sided growth, increasing from less than $10 million to $725 million in July 2026, expanding hundreds of times in less than three years. This indicates that the demand for stablecoin payments has not disappeared due to infrastructure adjustments but is still continuing to expand.

What has truly changed is the market structure.

Currently, RedotPay's monthly transaction volume has reached $382 million, accounting for more than half of the entire market; EtherFi and KAST have reached $96.95 million and $88.21 million, respectively. The top three platforms contribute nearly 80% of the transaction volume, while the market share of more small and medium-sized issuing platforms is rapidly declining.

This trend is also reflected in recent data. According to Paymentscan statistics, platforms affected by this event, such as Ready, SafePal, Bitget Wallet, and Solflare, have all seen significant declines in transaction volumes over the past 30 days, with Ready experiencing a drop of nearly 70%; meanwhile, platforms like Wirex One, EtherFi, and Exa have maintained growth, with Wirex One's transaction volume even increasing more than 11 times in the past 30 days.

In other words, Crypto Cards have not entered a recession but are undergoing a typical industry consolidation. Users have not abandoned this product but are continuously migrating to platforms with more stable underlying capabilities and more mature services.

If we look at the longer term, what has exited or contracted in the past year are not the users or the demand for stablecoin payments, but rather the Crypto Card business models that were rapidly built over the past few years.

These models were established against the backdrop of rapid growth in stablecoins, the opening of global payment networks, and the continuous expansion of cross-border financial cooperation, allowing for quick connections between wallets, banks, and card networks in a short time. However, as regulations tighten, bank risk controls become stricter, and operational costs continue to rise, this model that once supported rapid industry growth is also beginning to face reality checks.

Therefore, Fiat24 and Kulipa may not necessarily be the last companies to exit; they are more like the earliest signals of this round of industry adjustment: the crypto card payment industry will ultimately return to the most traditional competitive logic of the financial industry: trust, compliance, and sustainable operational capability.

Summary

Crypto Cards may seem like just a bank card, but in reality, they are one of the heaviest infrastructures in Web3.

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