The U card's exit is a historical mission that should have ended. From Crypto to TradFi, this is the next good business opportunity.
Author:Web3 Farmer Frank
On June 17th, Infini suddenly announced a comprehensive shutdown of all Card services.
As a star project in this round of U card fever, even after recently encountering a crisis of approximately $50 million in stolen funds, Infini did not stop its services, but now chose to actively exit the market. The explanation given by Infini co-founder @0xsexybanana is quite representative:
「Compliance costs are extremely high, profits are thin, operations are heavy... We made a strategic adjustment and removed the to C card business segment」
This reflects the real situation of this business - high compliance investment, minimal returns, high risk. After all, since last year, the PayFi narrative has been high-profile, especially in the first half of this year, with U card projects launching in clusters, a scene of blazing activity, until Infini's sudden exit this time.
This inevitably raises the question: Is the U card a good business?
I. "U Card" Has Never Been a Good Business
To discuss the U card issue, the first basic premise that needs to be clarified is that the current market is not questioning the direction of "spending with cryptocurrency", but the feasibility of the operational model behind the "U card" that heavily relies on traditional financial intermediaries.
Put simply, since the term "U card" began to be widely accepted, it has essentially referred to a specific business operation model:
From the early Dupay to later OneKey Card and Infini, they are essentially overseas prepaid consumption cards, where Web3 projects obtain authorization through cooperation with financial institutions and card organizations (such as Mastercard, Visa), and then package them into "offline consumption solutions" that crypto users can use.
Functionally, this model aggregates third-party intermediaries to connect consumption links, converting stablecoins into dollars and other legal tender and recharging them to prepaid cards, which indeed significantly alleviates the difficulty for Web3 users to "spend Crypto directly/through", and is a convenient solution in the Off-Ramp scenario, also considered a transitional product that combines Crypto with existing card payments in a specific historical stage.
However, commercially, it is an extremely fragile business because the lifeline of the entire "U card" operating model lies in its business model being highly dependent on the permission and stability of third-party institutions.
In fact, the projects currently offering similar services are no longer pure U card products focused on "on-chain traffic diversion + off-chain splicing". Taking SafePal, imToken, and TokenPocket as examples, these three are all based on the Swiss bank Fiat24, which can be said to have the same origin, with only different integrated paths and entry strategies:
- SafePal combines personal bank accounts and co-branded MasterCard services, placing Bank services on the first-level page;
- imToken, as a Fiat24 partner, primarily offers MasterCard services, with bank account services relatively hidden compared to SafePal, but still placing the "card" in the first-level entry;
- TokenPocket is more obscure, with service entry buried in the second-level entry, also primarily offering MasterCard services, and requiring the Google Play version on Android to enable;
Especially for platforms like SafePal, which directly cut into card issuance and account levels through strategic investment in Fiat24, no longer being "middlemen" at the end of the chain, fundamentally reducing friction and costs in intermediate links, they can feed this advantage back to users, offering benefits such as free account opening and zero transaction fees.
However, for wallets/exchanges, U card services are not their main business, but merely a bonus for Web3 custody/non-custody services - able to divert traffic, attract customers, and build long-term user loyalty and subsequent AUM. From this perspective, not making money or even losing money in the short term is acceptable.
So currently, as a bonus for improving user loyalty and asset service stickiness, the main players are almost wallets and exchanges, with the former represented by SafePal, imToken, TokenPocket, Bitget Wallet, and the latter including top exchanges like Bybit and Bitget.
As mentioned previously in 《Crypto Payment Card Era, An Unsustainable Business?》, Web3 wallets naturally have crypto asset management capabilities, are ideal PayFi service carriers, and can build a more long-term probability structure from aspects like traffic diversion, AUM, and user binding, with exchanges being similar.
Fundamentally, in such a highly regulated, compliant, and low-profit financial application scenario, if only trying to push through gathering and subsidies, for Web3 startups without a traffic main position and lacking fundamental financial understanding, it would be an extremely difficult bone to gnaw on, which is the fundamental reason why Infini ultimately chose to abandon consumer U cards and focus on wealth management and B-end services.
I have always believed that Crypto and TradFi are not on opposite sides, but are in an evolving process of accelerating integration and mutual leverage. After all, TradFi excels in compliance, regulatory oversight, account architecture, and risk control systems, while Crypto has natural advantages in asset openness, programmability, and trustless execution.
Therefore, before the payment system is completely transformed, the most stable, realistic, and sustainable path is still led by licensed financial institutions dominating compliant account and clearing systems, while Web3 projects focus on on-chain entry points and asset operations, forming an optimal combination of compliance and flexibility.
This model is the current solution, which may not be highly profitable but has strong structural resilience and is the most implementable PayFi solution at this stage, also the path followed by SafePal, imToken, etc.: Collaborating with Fiat24 to provide real, usable IBAN accounts, Mastercard payment cards, SEPA channels, and compliant deposit/withdrawal capabilities from brokers and CEXs, achieving an on-chain and off-chain asset closed loop.
If we extend the timeline further, the ultimate form of PayFi might be an on-chain payment network completely independent of Visa/Master:
- Merchants accept stablecoin payments without converting to fiat;
- Users directly send transactions from their wallets, with self-custodial and on-chain settlement;
- Backend supported by compliant stablecoins and clearing networks, without Visa/Mastercard or SWIFT channels;
In fact, this trend is already happening, from Circle launching Programmable Wallets and CCTP (cross-chain USDC settlement), to global payment giant Stripe acquiring the stablecoin API service provider Bridge for $1.1 billion last November, all attempting to connect on-chain accounts, stablecoin assets, and merchant payment endpoints, bypassing traditional payment routes involving card issuers and card organizations.
This also indicates that traditional payment network giants are no longer "wary of crypto" but are actively integrating on-chain capabilities, moving closer to Web3 account structures and stablecoin clearing networks. This system is expected to truly bypass the high costs and inefficiencies of traditional payment systems, and may even surpass existing cross-border payment solutions like Airwallex and Wise in terms of cost and experience, becoming the next-generation global payment infrastructure.
But that's in the future.
It can be foreseen that U Card belongs to the "past perfect tense", the current compliant bank account model of SafePal/Fiat24 is the "present continuous tense", while the on-chain stablecoin clearing network is the true "future tense".
Ultimately, whoever can navigate the evolution path of these three layers will be qualified to have a place in the next payment paradigm shift.
In Conclusion
So Infini's exit is just the natural conclusion of this transitional product destined to be replaced.
We might view it as Web3's tentative connection to the real world when compliance channels were not yet clear, and it has completed the historical mission of "making Crypto spendable" to some extent.
However, as regulatory red lines become clearer and stablecoin status continues to rise, user demands are shifting from "being able to swipe" to "being able to circulate, invest, and create a closed loop", requiring the construction of underlying capabilities, especially the bilateral synergy between Crypto and TradFi.
The next PayFi game is no longer about cards.
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