Claiming "KYC-free global payments," and facing inevitable shutdown within 6 months

Author: Milian

Translation: AididiaoJP, Foresight News

Original Title: Why Bypassing KYC for Crypto Cards Is Doomed to Fail

In the world of cryptocurrency, the promise of “KYC-free crypto cards” occupies a peculiar position.

They are promoted as technological achievements, packaged as consumer products, and marketed as escape routes for those seeking to evade financial surveillance. As long as Visa or Mastercard are accepted, you can spend cryptocurrency without any identity verification, personal information, or questions asked.

You might naturally ask: why has no one succeeded in making this happen? The answer is: it has already been attempted—more than once—but each time, it has failed again and again.

To understand why, you need to look beyond cryptocurrency itself and examine the infrastructure behind crypto cards. Debit and credit cards are not neutral tools; they are granted “passage rights” by a tightly regulated payment system dominated by Visa and Mastercard. Any card that can be used globally must be issued by a licensed bank, routed through a recognizable six-digit BIN code, and bound by a series of explicit compliance contractual obligations—including strict prohibitions on anonymous end users.

Building a card on top of the Visa/Mastercard system leaves no technical “workaround.” The only option is “misrepresentation.”

Most “KYC-free crypto cards” on the market are essentially corporate cards. Except for those with extremely low limits not designed for mass use, these cards are legally issued to companies (often shell companies), with the preset purpose of reimbursing internal expenses for employees. In some cases, these companies are legitimate; in others, their existence is merely a means to obtain card issuance privileges.

Consumers are never the intended cardholders in this structure.

This setup might operate temporarily. Cards are distributed publicly, labeled as consumer products, and their existence is tacitly tolerated until scrutiny arises. But attention always invites investigation. A compliance officer at Visa can trace the BIN code back to the issuing bank, identify abuse, and shut down the entire project. Once caught, accounts are frozen, the issuer is cut off, and the product disappears—usually within six to twelve months.

This pattern is not hypothetical. It is a repeatable, observable, well-known reality within the payment industry.

The illusion persists only because “shutdowns” always follow “launches.”

Why Users Are Drawn to “KYC-Free Cards”

The appeal of KYC-free cards is very specific.

They reflect the real-world constraints on accessing funds, intertwining privacy concerns with usability issues. Some users value privacy on principle; others live in regions with limited, unreliable, or outright restricted banking services. For users in sanctioned countries, KYC is not just an invasion of privacy but a direct barrier, severely limiting when and how they can access financial channels.

In these cases, non-KYC payment tools are not ideological choices—they are temporary lifelines.

This distinction is crucial. Risks do not disappear because “it’s necessary”; they simply concentrate. Users relying on these tools are often fully aware of the trade-offs: sacrificing long-term security for short-term usability.

In practice, channels that strip away identity verification and transaction reversibility tend to accumulate transaction flows that cannot pass standard compliance checks. This is the operational reality observed by issuers, project operators, and card networks—not mere speculation. When access is untraceable and enforcement capabilities are weak, funds blocked elsewhere naturally flow into these channels.

Once transaction volume grows, this imbalance quickly becomes apparent. The resulting concentration of high-risk funds is the main reason why, regardless of marketing or target users, these projects inevitably face scrutiny and intervention.

Market promotion around KYC-free crypto cards is often grossly exaggerated, far beyond what payment networks’ legal constraints allow. The gap between “promises” and “restrictions” is rarely noticed during user registration, but it foreshadows the eventual outcome once these products scale.

The Harsh Reality of Payment Infrastructure

Visa and Mastercard are not neutral intermediaries. They are regulated payment networks operating through licensed issuing banks, acquirer banks, and contractual frameworks requiring traceability of end users.

Every globally usable card is tied to an issuing bank, which is bound by network rules. These rules demand that the card’s ultimate user be identifiable. There are no exit mechanisms, no hidden configurations, and no technical abstractions that can bypass this requirement.

If a card can be used worldwide, it is embedded within this system by definition. Constraints are not at the application layer but in the contracts governing settlement, issuance, liability, and dispute resolution.

Therefore, achieving unlimited, KYC-free spending through Visa or Mastercard channels is not just difficult—it is impossible. Anything that appears to violate this reality is either operating within strict pre-set limits, misclassifying the end user, or merely “delaying” enforcement rather than “avoiding” it.

Detection is straightforward. A single test transaction can reveal the BIN, issuing bank, card type, and project manager. Shutting down a project is an administrative decision, not a technical challenge.

The core rule is simple:

If you haven’t done KYC for your card, someone else has.

And that someone else—who has completed KYC—is the true owner of the account.

“Corporate Card Exploits” Explained

Most so-called KYC-free crypto cards rely on the same mechanism: corporate expense cards.

This structure is not mysterious. It is an industry-known “loophole,” or rather, a “public secret” born from the way corporate cards are issued and managed. A company completes KYB (Know Your Business) verification, which is usually less stringent than personal KYC. To the issuer, this company is the client. Once approved, the company can issue cards to employees or authorized users without additional identity checks at the individual level.

In theory, this is meant to support legitimate business operations. In practice, it is often abused.

The end user is on paper “an employee,” not a bank customer. As such, they are not individually KYC-verified. This is the secret behind these products claiming to be “KYC-free.”

Unlike prepaid cards, corporate expense cards can hold and transfer large sums of money. They are not designed for anonymous distribution to consumers nor for custodial third-party funds.

Cryptocurrency cannot be directly deposited into these cards, so various back-end “workarounds” are used: wallet intermediaries, conversion layers, internal bookkeeping…

This structure is inherently fragile. It can only last until it attracts enough attention. Once scrutinized, enforcement becomes unavoidable. History shows that projects built this way rarely survive beyond six to twelve months.

The typical process:

1. Create a company and complete KYB verification with the card issuer.
2. To the issuer, this company is the client.
3. The company issues cards to “employees” or “authorized users.”
4. End users are treated as employees, not bank customers.
5. Therefore, the end users themselves do not undergo KYC.

Is this a loophole or illegal?

Issuing company cards to real employees for legitimate business expenses is legal. But publicly issuing them as consumer products is not.

Once cards are distributed to “fake employees,” marketed openly, or primarily used for personal consumption, the issuer faces risk. Visa and Mastercard can act without new regulations—they only need to enforce existing rules.

A single compliance review is enough.

Visa compliance officers can register, receive cards, identify the issuing bank via the BIN, trace the entire project, and shut it down.

When this happens, accounts are frozen first. Explanations may follow later, or sometimes not at all.

Predictable Lifecycle

Projects marketing “KYC-free” crypto cards follow a remarkably consistent pattern, repeated across dozens of cases.

First is the “honeypot phase.” The project quietly launches, early access is limited, and initial transactions appear successful. Confidence builds, marketing accelerates. Limits are increased, influencers promote promises. Screenshots of success circulate, and the once niche project gains visibility.

Visibility is the turning point.

Once transaction volume increases, scrutiny becomes inevitable. Issuing banks, project managers, or card networks review activity. BINs are identified. The discrepancy between marketing claims and actual operation becomes clear. At this point, enforcement is no longer a technical issue but an administrative one.

Within six to twelve months, the outcome is almost always the same: the issuer is warned or ceases cooperation; the project is suspended; cards suddenly stop working; balances are frozen; operators vanish behind customer support tickets and generic email addresses. Users have no recourse, no legal standing, and no clear timeline for fund recovery—if recovery is even possible.

This is not speculation or theory. It is an observable pattern recurring across jurisdictions, issuers, and market cycles.

Any “KYC-free” card operating on Visa or Mastercard will eventually be shut down—the only variable is timing.

The Inevitable Destruction Cycle (Summary)

• Honeypot phase: a “KYC-free” card quietly launches. Early users succeed, influencers promote, transaction volume rises.
• Regulatory squeeze: issuing banks or card networks review the project, flag BINs, identify abuse of the issuance structure.
• Crossroads:
  • Forced KYC implementation → privacy promises are shattered.
  • Project operators run or disappear → cards are deactivated, balances frozen, support channels cut off.

There is no fourth outcome.

How to Spot a “KYC-Free” Crypto Card in 30 Seconds

Take the marketing image of Offgrid.cash’s so-called non-KYC crypto card as an example. Enlarge the card, and one detail immediately stands out: the “Visa Business Platinum” label.

This is not a design flourish or branding choice; it is a legal classification. Visa does not issue business platinum cards to anonymous consumers. This label indicates it is part of a corporate card program, with the account and funds owned by the company, not the individual user.

The deeper implications of this structure are rarely made explicit. When users deposit cryptocurrency into such a system, a subtle but critical legal shift occurs: the funds are no longer the user’s property but become assets controlled by the company holding the account. The user has no direct relationship with the issuing bank, no deposit insurance, and no rights to complain to Visa or Mastercard.

Legally, the user is not a customer at all. If the operator disappears or the project ends, the funds are not “stolen” but have been voluntarily transferred to a third party that no longer exists or cannot access the card network.

When you deposit cryptocurrency, a key legal transformation occurs:

• Funds no longer belong to you.
• They belong to the company that completed KYB verification with the bank.
• You have no direct relationship with the bank.
• You lack deposit protection.
• You have no right to complain to Visa or Mastercard.
• You are not a customer—you are just a “cost center.”
• If Offgrid disappears tomorrow, your funds are not “stolen”—you have legally transferred them to a third party.

This is the core risk most users never realize.

Three Immediate Warning Signs

You don’t need insider knowledge to judge whether you are funding a corporate card. Just look for three points:

• The card type printed on the card: if it says Visa Business, Business Platinum, Corporate, or Commercial, it is not a consumer spending card. You are being registered as an “employee.”
• Network logos: if it bears the Visa or Mastercard logo, it must comply with AML, sanctions screening, and end-user traceability regulations.
• No exceptions.
• No technical workarounds.
• Only a matter of time.
• Unreasonable spending limits: if a card offers high monthly limits, reloadability, global acceptance, and no KYC, then someone else has done KYB for you.

Current Projects Marketing “KYC-Free” Cards

The current marketing of “KYC-free” cards falls into two categories: prepaid cards and so-called “business” cards. Business cards rely on various variants of the corporate card loophole, with different names but unchanged structures.

A non-exhaustive list of current “KYC-free” card projects (covering prepaid and business models) can be found at https://www.todey.xyz/cards/.

Examples include:

• Offgrid.cash
• Bitsika
• Goblin Cards
• Bing Card
• Similar crypto cards distributed via Telegram or invite-only

Case Study: SolCard

SolCard is a typical example. It launched in a KYC-free mode and gained attention, then was forced to switch to full KYC. Accounts were frozen until users provided identity info, and the original privacy promise collapsed overnight.

The project ultimately shifted to a hybrid structure: a very low-limit KYC-free prepaid card and a fully KYC-verified card. The original KYC-free mode could not survive once it attracted substantial usage—an inevitable result of operating on incompatible tracks.

Case Study: Aqua Wallet’s Dolphin Card

In mid-2025, Aqua Wallet, developed by JAN3, launched the Dolphin Card—a Bitcoin and Lightning wallet. It was a limited test version for 50 users, no ID required. Users could deposit Bitcoin or USDT, with a spending cap of $4,000.

This cap was very telling—it clearly aimed to reduce regulatory risk.

Structurally, the Dolphin Card combined a prepaid model with a corporate account setup. The card operated through a company-controlled account, not a personal bank account.

It functioned normally for a time but not forever.

In December 2025, the project suddenly paused due to an “unexpected issue” with the card provider. All Dolphin Visa cards immediately became invalid, and remaining balances had to be refunded manually via USDT, with no further explanation.

Risks for Users

When these projects collapse, users bear the cost.

Funds may be frozen indefinitely, refunds may require cumbersome manual processes, and sometimes balances are lost entirely. There is no deposit insurance, no consumer protection, and no legal rights against the issuing bank.

Particularly dangerous is that many operators are fully aware of this outcome beforehand but continue pushing forward. Others hide the risk behind claims of “proprietary technology,” “regulatory innovation,” or “new infrastructure.”

Issuing company cards to fake employees is not a matter of “proprietary tech”—it’s either ignorance or outright exploitation.

Prepaid and Gift Cards: What Is Truly Feasible?

Legitimate non-KYC payment tools do exist but with strict limits.

Prepaid cards purchased through compliant providers are legal because they have very low limits, designed for small transactions, and do not pretend to offer unlimited spending. Examples include prepaid crypto cards offered via platforms like Laso Finance.

(@LasoFinance website screenshot)

Gift cards are another option. Services like Bitrefill allow users to buy mainstream merchant gift cards with crypto privately and legally.

(@bitrefill website screenshot)

These tools are effective because they respect regulatory boundaries rather than pretending they don’t exist.

The Core Falsehood

The most dangerous claims are not about “KYC-free” itself but about its permanence.

These projects imply they have “solved” the problem, found “structural loopholes,” and that their technology makes compliance “irrelevant.”

But that’s not true.

Visa and Mastercard do not negotiate with startups; they enforce rules.

Any product claiming high limits, reloadability, global acceptance, and no KYC while bearing Visa or Mastercard logos is either misrepresenting its structure or planning to disappear soon.

There is no “proprietary” technology that can bypass this fundamental requirement.

Some operators argue that KYC will eventually be introduced via “zero-knowledge proofs,” so the company itself never directly collects or stores user identities. But this does not solve the core issue. Visa and Mastercard do not care “who” sees the identity info; they require it to be recorded and accessible during audits, disputes, or law enforcement actions, readable by the issuer or compliant partners.

Even if identity verification is done via privacy-preserving credentials, the issuer must still have access to a clear, readable record at some point in the compliance process. This is not “KYC-free.”

What Happens if You Bypass the Dual Monopolies?

(@ColossusPay website screenshot)

A class of card-based payment systems fundamentally changes the game: systems that do not rely on Visa or Mastercard at all.

Colossus Pay exemplifies this approach.

It does not issue cards through licensed banks nor route transactions via traditional card networks. Instead, it operates as a native crypto payment network, directly connecting with merchant acquirers—entities that hold merchant relationships and control point-of-sale software, such as Fiserv, Elavon, Worldpay, etc.

By integrating at the acquirer level, Colossus completely bypasses the issuing banks and card networks. Stablecoins are routed directly to acquirers, converted as needed, and settled to merchants. This reduces costs, shortens settlement times, and removes the “interchange fees” charged by Visa and Mastercard.

Crucially, since no issuing bank or card network participates in the transaction flow, there are no contractual obligations requiring end-user KYC. Under current regulatory frameworks, the only entity with KYC obligations is the stablecoin issuer itself. The payment network does not need to invent loopholes or misclassify users because it operates outside the card network rules from the start.

In this model, a “card” is essentially just a private key that authorizes payments. Achieving KYC-free is not the goal; it is a natural byproduct of removing the dual monopolies and their compliance structures.

This is a genuinely honest, structurally sound path toward non-KYC payment tools.

If this model is feasible, the obvious question is: why isn’t it widespread?

The answer is distribution.

Connecting with acquirers is difficult. They are conservative institutions, controlling point-of-sale systems, and slow to act. Integration at this layer takes time, trust, and operational maturity. But it is also the place where real change can happen, because it controls how the real world accepts payments.

Most crypto card startups have chosen the easier route: integrate with Visa or Mastercard, aggressively market, and expand quickly before enforcement arrives. Building outside the dual monopoly is slower and more difficult, but it is the only path that won’t end in “shutdown.”

Conceptually, this approach reduces credit cards to a crypto primitive. The card is no longer an account issued by a bank but a private key that authorizes payments.

Conclusion

As long as Visa and Mastercard remain the underlying infrastructure, unlimited spending without KYC is impossible. These restrictions are structural, not technical; no branding, storytelling, or fancy terminology can change that.

When a card bearing Visa or Mastercard logos promises high limits and no KYC, the explanation is simple: either it exploits a corporate card structure, placing the user outside the legal relationship with the bank; or it is a false representation of how the product actually works. History repeatedly confirms this.

The safer, more reliable options are low-limit prepaid and gift cards with clear caps and expectations. The only truly sustainable, long-term solution is to break the dual monopoly of Visa and Mastercard entirely. Everything else is temporary, fragile, and exposes users to risks they often only realize too late.

In recent months, I’ve seen a surge in discussions about “KYC-free cards.” I am writing this article because there is a huge knowledge gap about how these products actually operate and the legal and custodial risks they pose to users. I have nothing to sell; I write about privacy because it matters—regardless of the field.