Visa Moves to End Meme Coin Credit-Card Rewards Workaround
AI Market Summary
Visa's move to close a merchant-category-code loophole used to buy meme coins via credit cards shifts these purchases into explicit crypto processing, tightening compliance and likely reducing reward-driven demand. Processors have a near-term deadline to stop miscoding, raising friction for retail on-ramps. The involvement of Chase and the New York State Attorney General underscores heightened scrutiny of crypto card rails and payment classification practices.
Impact level
● Medium
Affected assets
BTC/USDT-0.30%
AI Insight · BTC/USDTAI Insight
▼ Bearish
Trade now
⚠️ AI-generated insights are based on news content and are provided for informational purposes only. They do not constitute investment advice or represent the views of BingX. Investing involves risk. Please trade responsibly.
Visa is moving to close a checkout workaround tied to crypto payments firm Crossmint that let some meme-coin purchases made with credit cards be coded as digital media transactions, such as ebooks, movies, or music, according to Odaily Planet Daily.
Visa has told payment processors, including Checkout.com, that the merchant category code used for those meme-coin transactions will no longer be accepted. Processors have been given a short grace period to stop using the code, which is expected to expire next week.
Once the grace period ends, meme-coin purchases will need to be processed as cryptocurrency transactions and will be subject to Visa's applicable rules.
Separately, JPMorgan Chase challenged a Visa transaction that was not flagged as a crypto purchase, saying the merchant category code was misclassified and should not qualify for credit-card rewards. The New York State Attorney General's Office has also been informed of the issue and reviewed it. (Decrypt)
