Visa Moves to Close Meme Coin Credit Card Rewards Loophole

RegulationDigital Finance
โดย Crypto In America·US·Read original
Summary · why it matters

Visa is moving to close a loophole that let meme coin purchases made with its credit cards earn ordinary credit card rewards. According to a source familiar with the matter, the workaround allowed meme coin purchases processed through the crypto payments infrastructure firm Crossmint to be coded as "digital goods media," a category typically used for e-books, movies and music, rather than as crypto transactions. The move follows a Block investigation finding that users of the Robinhood Wallet and Fomo apps could buy meme coins with credit cards through Apple Pay or Google Pay without completing a separate KYC process, with test purchases powered by Crossmint and made with both Visa and Mastercard cards coded as digital goods media. Chase told The Block that one Visa transaction had not been flagged as a cryptocurrency purchase, had been assigned the wrong merchant category code and should not have earned rewards, and the bank opened a case with Visa challenging the classification, while the New York attorney general's office said it was aware of and reviewing the matter. In correspondence reviewed by Crypto In America, Visa told at least one industry participant that the digital goods media merchant code is not appropriate for meme coin purchases, and has informed payment processors including Checkout.com that the code will no longer be accepted for those transactions, with a grace period expected to end next week. Going forward, the purchases must be processed as crypto transactions and will be subject to Visa's corresponding rules and restrictions.

Impact on stocks 6

Digital Finance & Tokenization▲ · 5 stocks
Visa Inc. Class A
V
▲ PositiveRegulationrelevance

Visa is closing the merchant-code loophole so meme coin purchases must be processed as crypto transactions under its rules, protecting its rewards and compliance framework.

Robinhood Markets Inc
HOOD
± MixedRegulationrelevance

Robinhood Wallet was cited in the Block investigation as a venue where meme coins could be bought with credit cards without separate KYC, prompting Visa's crackdown.

JPMorgan Chase & Co
JPM
± MixedRegulationrelevance

Chase flagged a mis-coded Visa transaction, opened a case with Visa, and said it should not have earned rewards.

Mastercard Inc
MA
± MixedRegulationrelevance

Mastercard cards were used in the test purchases coded as digital goods media, but the article focuses on Visa's rule change.

Financials▲ · 1 stocks

Theme Impact 2

Off-coverage companies 3

CrossmintPrivate▼ Negative
Regulationrelevance

Crossmint's crypto payments infrastructure enabled the meme coin purchases coded as digital goods media that Visa is now moving to block, ending the workaround it powered.

Checkout.comPrivate▼ Negative
Regulationrelevance

Visa has informed payment processors including Checkout.com that the digital goods media merchant code will no longer be accepted for meme coin transactions, forcing a change in its processing rules.

fomoPrivate± Mixed
relevance

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