In recent times, the use of crypto cards has become pivotal for a range of crypto services. Even the companies have been encouraging the use of cards among the users to avoid any risk of blocking transactions. However, the truth is that the use of cards does not benefit the end-users or the fintech companies but only brings profits to intermediaries and payment system facilitators. It is essential to understand that a crypto card is not an innovative financial product. In these cards, instead of the dollar or other financial currencies, the cryptocurrencies would be used for transactions. It is essential for the banking and the payment processing companies understand this and regulate the workings of the processors like WaveCrest, WireCard, etc.
The usage of Visa, Mastercard, and other payment systems is based on commissions. Such commissions with regards to Crypto cards would be much higher as the conventional banking and financial industry considers crypto transactions as high-risk. The fintech companies would find it impossible to make crypto cards work without letting the payment systems and other intermediaries join the network. Thus, crypto cards are financially not viable at the moment unless it gains more trust in the traditional financial industry to enter the mainstream market.
However, it is possible for payment processors like Visa and Mastercard can make their cards more crypto-friendly. The processors such as WaveCrest and Wirecard are considered high-risk and can be compared to micro-finance organizations that lend money at a higher interest rate. These companies also lend out money at a huge interest rate when banks and other traditional financial institutions turn down the borrowers. The non-cooperation or less reliance on the cryptocurrencies and crypto ecosystem is what has made crypto cards a necessity. The banks fear taking risks, and this has made it difficult for the crypto world to thrive, making way for high-risk processing companies like WaveCrest and Wirecard to surface.
The easy way out of this is for the banks to collaborate with the regulated crypto services and further the expertise on crypto compliance. The employees at the banks find it easier to say no to the potential clients at the expense of delving deeper into the peculiarities of high-risk transactions. The cryptocurrencies’ ecosystem has been growing at a tremendous pace. If the bank can regularly and systematically monitor, process, and regulates high-risk transactions related to crypto, it can give birth to many revenue-generating opportunities. Crypto cards would soon be a reality, but it is the banks that should take the matter in their own hands rather than independent financial entities trying to do the same.