Hong Kong blockchain start-up rolls out Asia’s first cryptocurrency Visa debit card to take on credit cards

Crypto.com, the Hong Kong-based blockchain start-up behind Asia’s first cryptocurrency Visa debit card, said on Wednesday its partner bank has applied to issue cards in the city. Over the next two months the company will ship more than 100,000 cards to customers globally, starting with Singapore.

In rolling out the Visa debit card, the company is offering a new instrument for an untapped market. “To holders of cryptocurrencies, having the peace of mind that you can readily convert back into fiat currencies and cash out is very important,” said Kris Marszalek, Crypto.com co-founder and chief executive.

“Not all exchanges support crypto-to-fiat transactions, and even if you hold your digital assets at the exchanges’ wallet, the withdrawal process is also complicated. We believe our product addresses a real need, and enhances trust in digital assets,” he said.

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The company, called Monaco before a name change in July, also plans to apply for moneylending licences in Singapore and Hong Kong. Marszalek says the company wants to gradually transform from a cryptocurrency debit card platform into a cryptocurrency-backed money lender. If things go according to plan, holders of the company’s Visa cards and users of its cryptocurrency wallet service could also take out loans collateralised with bitcoin and MCO, Crypto.com’s own token.

The Visa debit cards are issued in partnership with a Singpore-based subsidiary of Germany listed financial technology company Wirecard Bank. The entity is a stored-value facility issuer overseen by the Monetary Authority of Singapore.

Marszalek said he expected the debit cards, together with Crypto.com’s planned lending service, to ultimately disrupt the credit card industry. He said the way in which banks have been issuing unsecured revolving credit to consumers who can hardly afford their interest rates bordered on “unethical business”. Revolving credit allows customers to borrow up to a credit limit and does not have a fixed schedule for repayment like an instalment loan.

“The credit card business model is one that is bordering on unethical business, as banks make a big chunk of profit from people who cannot afford late fees. These people should not be given a credit card in the first place,” said Marszalek.