Visa Reclassifies Memecoin Card Buys as Crypto, Ending Rewards

Visa will reclassify memecoin credit card purchases as standard cryptocurrency transactions. This change strips the digital media status that previously allowed users to earn cashback and points. The shift effectively ends a loophole that treated speculative token buys like streaming subscriptions.

The network sent directives to Crossmint and Checkout.com on September 20. These firms currently process card payments for tokens on platforms like Fomo. Visa stated that the current coding method is no longer acceptable for these financial products. The new rules align memecoin activity with existing crypto payment restrictions.

Merchant codes drive reward eligibility

Transactions were previously tagged with merchant category code 5815. This code identifies digital content such as movies and audiobooks. Consequently, banks processed these buys as normal retail spending. Users accumulated loyalty rewards just as they would for any other consumer purchase.

Visa’s new guidance forces these trades into a restricted crypto category. This classification removes access to points and cashback programs. The move prevents cardholders from gaining financial perks on speculative investments. It also flags these payments for stricter network-level monitoring and controls.

Regulatory scrutiny intensifies across sectors

JPMorgan Chase identified the digital media coding as inappropriate earlier. The bank raised the issue directly with Visa management. The New York Attorney General’s office is also reviewing the matter. This regulatory pressure likely accelerated the network’s decision to enforce stricter standards.

Crossmint maintains that its relationship with card networks remains stable. The company states it will revise procedures if guidance changes. It has not been disclosed whether Mastercard has issued similar directives. The situation highlights growing tension between payment processors and financial regulators.

Implementation timeline remains tight

Visa provided a grace period for payment companies to adjust. The new restrictions could take effect as early as next week. This rapid implementation leaves little time for merchants to update systems. Users may see immediate changes in their reward balances.

According to bloomingbit.io, this shift marks a significant tightening of rules. It signals a broader industry move to separate speculative assets from retail spending. The decision prioritizes financial stability over consumer convenience in this niche market.