Hong Kong-based cryptocurrency payment company Crypto.com (formerly known as Monaco) has designed the first cryptocurrency Visa card in Asia, by merging the two rivaling industries to one single entity.
Its partner bank, Wirecard Bank, which is a Singapore-based subsidiary of Germany-listed financial technology company, has applied to issue cards in the city, with the company aiming to ship more than 100,000 cards to customers globally, starting with people in Singapore.
By rolling out the Visa debit card for cryptocurrency, the company offers a new way for the 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," explained Kris Marszalek, Crypto.com co-founder and CEO.
"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."
The company also plans to apply for money-lending licences in Singapore and Hong Kong.
As explained by Marszalek he said that 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 collateralized with Bitcoin and MCO, Crypto.com’s own token.
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 traditional 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 installment 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.
The Crypto.com debit card aims to be linked to wallets for both fiat money and cryptocurrency, which will allow users to spend their cryptocurrencies after converting them into fiat money.
The company initially supports five cryptocurrencies: Bitcoin, Litecoin, Ethereum, MCO and Binance Coin.
These digital coins can be converted into seven fiat currencies, including Singapore dollar, U.S. dollar and Hong Kong dollar.