Opinion: Vikram Arun, co-founder and CEO of Superform

Crypto cards are not the future of payments. They provide a ephemeral interface to a world that has not fully embraced cryptocurrencies.

They rely on banks as issuers, Visa or Mastercard as gatekeepers, and compliance rules that look exactly like TradFi.

In most cases, the cryptocurrency is sold for unused USD, the asset stops earning interest, and any transfer triggers a taxable event.

This is not innovation. It’s a debit card with extra steps.

As digital banks built to scale on blockchain rails, crypto cards that behave like debit cards will become obsolete and be replaced by systems that treat cards as a skinny interface in addition to solid onchain credit.

Problem with current crypto cards

To understand why this change is necessary, consider what is happening with current crypto cards. When systems force users to liquidate their holdings, they reinforce the paradigm that cryptocurrency was designed to escape from: the false choice between liquidity and ownership.

Debit-style crypto cards reproduce the same trade-off because they require the asset to become a spendable balance, which holds back profitability and makes the system structurally negative without the subsidy.

IRS delicacies converting cryptocurrency to fiat currency as part of a taxable sale, meaning any coffee purchase triggers capital gains reporting and permanently removes the asset from productive utilize. Usually card issuers to earn From 1% to 3% plus a flat fee per transaction, on Interchange fees. The infrastructure appears decentralized on the surface, but the dependencies are deep.

Onchain Credit solves these problems

Instead of selling assets to spend, onchain credit allows people to deposit income-producing assets, open a line of credit, and spend the money. When people pull out a card, their debt increases, but their assets continue to earn money. Nothing will be sold unless the person fails to repay. If the position falls below the parameters set by the management, the liquidation is deterministic and crystal clear. This shift towards native wallet lending shows that onchain lending is moving from concept to practice.

In this model, expenses do not reduce ownership; increases debt. The security is increased until the credit line is repaid or liquidated. There are no forced conversions or inactive balances. Currently yielding stablecoins offer yield around 5% and DeFi protocols range from 5% to 12%, depending on demand and symbolic incentives.

Users who hold these assets in credit accounts continue to earn while retaining purchasing power.

Collateral can be any asset that generates income

This move from debit to credit fundamentally changes what is possible. When credit becomes a fundamental issue, the question is no longer: “what can I spend?” and becomes “What can safely secure my credit?” Eligibility is no longer dependent on whether the asset can be immediately converted into cash. The question is whether it can be valued continuously, mitigated risk and developed deterministically.

This allows productive assets to compete for inclusion. Vault shares, yielding dollars, U.S. Treasury-backed assets, and strategic positions are prime hedges that do not need to be converted to free balances. These assets remain productive until they need to be liquidated. When assets continue to earn, users don’t have to choose between liquidity and yield, lines of credit become cheaper to maintain, and protocols make money on management and performance rather than interest spreads.

The card is just an interface

The card is not a product. The card is simply a consumer-facing compatibility layer, a skinny authorization surface, not a source of truth. What really matters is the line of credit itself: the ability to assess an onchain user’s balance and decide in real time whether a given expense should be allowed.

Related: Spending on Visa crypto cards will enhance by 525 percent in 2025

Cards serve merchants and consumers. But once credit becomes primitive, interfaces become interchangeable. Software and autonomous agents can now request payments programmatically. Whether it’s cards or APIs, the basic question is the same: Is this expense authorized based on the user’s funds?

If credit logic is present in the card, people remain locked into interchange fee structures, closed payment rails and fixed KYC requirements. If credit works online, cards become optional. Collateral remains in user-controlled accounts, expenses are approved in real time, and liquidation is deterministic.

Risk management through transparency

Of course, this system raises security questions. The most immediate objection is volatility. If the value of the security can fluctuate, what protects people from liquidation while grocery shopping?

Management proactively sets conservative loan-to-value ratios, ensuring that users can only borrow against a fraction of their collateral. As the hedge earns profits, this buffer increases automatically. Valuation takes place continuously rather than at arbitrary intervals, and liquidation triggers are crystal clear from the outset.

Established credit obscures risk through adjustable interest rates, surprise fees, and terms hidden in legal documents. Onchain credit clearly states the risks. The parameters established in oversight mean that it is the community that decides what is acceptable, rather than the bank’s risk committee behind closed doors.

The path 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 acceptable level of risk and the moments of liquidation. People consent by submitting collateral, and from that point on the protocol enforces the rules without general access to funds or without silently changing parameters.

Crypto cards won’t disappear because they failed. They will disappear because they have managed to connect cryptocurrencies to a world that still runs on older rails. As wallets improve and crypto payments become the standard, spending will not require banks, issuers or card networks at all. Interfaces will change. Payment rails will evolve. However, onchain credit will remain: the ability to spend money without selling, keep assets productive and enforce risk transparently.

Tabs are the interface. Credit is a system.

Opinion: Vikram Arun, co-founder and CEO of Superform.