Binance rumored to acquire Swipe.io shares, breaking through barriers in the physical payment card business.

According to blockchain media The Block, cryptocurrency exchange Binance has completed the acquisition of cryptocurrency payment startup Swipe.io, which not only drove up the token price of Swipe.io's token SXP, but also paved the way for the crypto exchange giant to advance its plans for physical payment cards.

Binance to Launch "Binance Card"

According to previous reports, the cryptocurrency exchange Binance plans to introduce a physical payment card called "Binance Card" supported by Visa. This financial card functions similar to a debit card used by the public, allowing users to shop and pay online bills after depositing Bitcoin (BTC) or Binance Coin (BNB) into it. When registering for the card, Binance only charges a one-time payment fee of $15, with no annual or monthly fees required, and no need to stake cryptocurrencies like MCO.

Interestingly, after Binance made a big announcement about the card, they quietly removed the Visa logo from the card on their website. According to reports, a Visa spokesperson claimed that Binance did not have the necessary authorization, introducing uncertainty to Binance's physical payment card business.

Decline in Popularity of Cryptocurrency Visa Cards

Due to their wide availability and low barrier to entry, cryptocurrency debit cards have become increasingly popular in the past couple of years, with the "MCO Visa Card" issued by Crypto.com being a top choice for users in Taiwan. However, the issuing bank Wirecard, which collaborated with the company, faced financial issues on June 18th, with €1.9 billion in assets mysteriously disappearing. According to a report by Reuters on the 22nd, Wirecard further stated in a recent announcement that "the €1.9 billion likely do not exist."

Although the CEO of Crypto.com assured users that all fiat funds are safe and guaranteed 100% refund in case of any impact on Wirecard's services, many users still chose to withdraw their funds, and the value of the cryptocurrencies issued by the company dropped by over 10% after the incident.

Binance Acquires Swipe.io

Despite the challenges faced by Binance and VISA's fiat channels, the popularity of cryptocurrency debit cards in the market took a hit due to the Wirecard incident. However, Binance seems undeterred in their development of physical payment cards. According to a report by blockchain media outlet The Block,Binance is acquiring a majority stake in the cryptocurrency payment startup Swipe.io, with the announcement possibly coming out this week (following the news, Swipe.io's token SXP surged by up to 33%).

Swipe.io itself offers a multi-currency cryptocurrency wallet application and issues its own Visa debit cards. These cards are issued by Contis Financial Services Ltd, a member of the VISA card organization, which has obtained issuing licenses from the UK Financial Conduct Authority. It is said that the Binance Card itself will be issued as a white-label product through services provided by Swipe.io.

In comparison to Coinbase, Binance has been lagging behind in this area for several years. Building a new payment system to overcome regulatory barriers will undoubtedly require more time and effort for Binance. From this perspective, investing in Swipe.io, which already has established fiat payment channels and a complete product, is indeed the most efficient way for Binance to swiftly enter the realm of physical payment cards.

However, it is important to note that the issuing license of Swipe.io's issuing bank, Contis Financial Services Ltd, is limited to the European region, as evident from the regions supported by Swipe.io's debit cards

For Binance, merely connecting payment channels in Europe is far from sufficient. It can be expected that Binance will have more news in the payment field in the future, but it cannot be ruled out that Swipe.io may collaborate with other issuing banks to expand the supported regions.