Crypto cards are not the future, but onchain credit is.

Comment by: Vikram Arun, Co-Founder and CEO of Superform

Cryptocards are not future payments. They are a temporary interface to a world that has not fully embraced cryptocurrencies.

They rely on banks as issuers, Visa or MasterCard as gatekeepers, and compliance regulations similar to TradFi.

In most cases, crypto is sold into idle US dollars, the assets stop earning and each swipe creates a taxable event.

That is not innovation. That's a debit card with extra steps.

Digital banks built at blockchain rail scale will make crypto cards that look like debit cards obsolete, replacing cards with systems that act as a thin interface to solid onchain credit.

The current problem with crypto cards

To understand why this change is needed, consider what happens with current crypto cards. When systems force users to withdraw holdings, they reinforce the very paradigm that crypto is meant to escape: the false choice between liquidity and ownership.

Debit-style crypto-cards recreate this same trade-off because they require assets to be withdrawable balances, which stops production and makes the system structurally negative sum unsubsidized.

The IRS considers converting cryptocurrency to fiat currency a tax avoidance, meaning that each coffee purchase is reported as a capital gain and permanently removes assets from productive use. Card issuers earn 1% to 3% in interchange fees, plus a flat fee per transaction. The infrastructure seems decentralized, but the dependencies run deep.

Onchain Credit fixes these issues

Onchain credit allows you to put up productive assets, open a line of credit, and spend on them instead of selling them. As people swipe the card, their debt increases, but their assets are gaining. Unless the man can return, he will not sell anything. If the position falls below the standards defined by management, the liquidation is decisive and clear. This transition to pocket-native credit marks the transition of onchain credit from concept to practice.

In this model, ownership costs are not reduced; Debt increases. A lien will continue to accrue until the line of credit is paid off or closed. No forced conversions and idle scales. Yielding stablecoins currently yield 5%, and DeFi protocols range from 5% to 12% depending on demand and token incentives.

Consumers who hold these assets in loan accounts are getting protection of their spending power.

Any income asset can be collateral.

This fundamentally changes what is possible to convert from debit to credit. Once credit is prime, the question stops being “What should I use?” and “What can reliably verify my credit?” Eligibility is no longer a matter of whether the property can be cashed out instantly. It is whether or not it can be continuously priced, risk-limited and harmless.

This allows productive assets to compete for inclusion. Vault shares, yielding dollars, U.S. Treasury-backed assets and strategic positions are primary securities that do not need to be converted into idle balances. These properties remain effective until liquidation becomes necessary. As assets continue to accrue, users no longer have to choose between liquidity and profitability, credit lines become cheaper to maintain and protocols benefit from management and performance, not interest distribution.

The card is only an interface

The card is not the product. A card is simply a consumer-facing compatibility layer, a thin layer of authorization, and not a source of truth. In fact, the key issue is the line of credit itself: the ability to value a user's onchain balance sheet and determine whether spending should be allowed in real time.

Related: Visa Crypto Card Spending to Grow 525% by 2025

Cards serve merchants and consumers. Once credit is prioritized, however, interfaces become interchangeable. Software and autonomous agents may request payment programmatically. Whether it's a card or an API, the main question is the same: Is this spending allowed against the user's credit?

If credit logic resides in the card, people will remain locked into variable payment structures, closed payment channels and strict KYC requirements. If credit is chained, cards are optional. In user-controlled accounts, holding periods, spending is authorized in real-time and checking is determined.

Managing risk using transparency

Of course, this system raises questions about security. The most immediate resistance is volatility. If collateral is volatile, what prevents people from losing money when buying commodities?

Management sets a conservative loan-to-value ratio in advance, meaning consumers can only borrow a fraction of their mortgage. When the container gets production, this buffer grows automatically. Pricing occurs continuously, not randomly, and liquidity triggers are clear from the start.

Traditional credit hides the risk of fixed interest rates, unexpected fees, and contracts buried in legal documents. Onchain makes credit risk clear. Governance-set parameters mean the community decides what is acceptable, not a bank's risk committee behind closed doors.

The way forward

The answer to managing this risk lies in how the system is managed. Management controls which assets can be used as collateral, how they are valued, the amount of risk accepted, and when liquidity is created. People opt in by making a deposit, and from then on the protocol enforces its rules of not receiving funds or silently changing parameters.

Cryptocards don't disappear because they fail. They will disappear because they have succeeded in connecting crypto to a world that still runs on legacy rails. As wallets evolve and crypto-native payments become the norm, spending will never require banks, issuers or card networks. Interfaces will change. Payment lines will be improved. But the onchain credit remains: the ability to issue unsold, to leverage assets and transparently enforce risk.

Cards are an interface. It's the credit system.

Comment by: Vikram Arun, Co-Founder and CEO of Superform.