• Visa ordered Checkout.com to reclassify memecoin purchases under standard crypto classification codes

• Crossmint routed credit card crypto purchases through MCC 5815, the digital media code

• Grace period for Crossmint transactions on Fomo and Robinhood Wallet expires next week

Visa Orders Memecoin Reclassification

Visa (V) has moved to shut down a credit card rewards loophole that let shoppers earn points and cashback on memecoin purchases. The card network has directly instructed payment processor Checkout.com to switch memecoin transactions from the “digital media” merchant category back to standard cryptocurrency classification, and the grace period for the old treatment is set to expire next week. Once that deadline passes, card purchases of memecoins — a class spanning tokens from Bonk (BONK) to ApeCoin (APE) — will be processed under the same rules as any other crypto asset transaction.

The dispute centers on the merchant category code (MCC) system, the classification backbone of the card industry. Every merchant type carries a code, and digital media purchases such as streaming video and audiobooks sit under MCC 5815 — a bucket card issuers generally treat as rewards-eligible. Payment infrastructure firm Crossmint had placed credit card crypto purchases under this code, meaning users of apps like Fomo and Robinhood Wallet could rack up credit card points when buying memecoins, much as they would for a streaming subscription. The discrepancy first surfaced in a September 1 investigation into card-based crypto purchases, which found that memecoin transactions carried none of the special flags that normally mark crypto asset spend on card networks.

Regulatory attention preceded Visa’s move. Chase deemed the classification inappropriate when it surfaced and referred the matter to Visa, while the office of New York Attorney General Letitia James confirmed it was examining Crossmint’s product. The category had also grown loose in practice: Genius Terminal’s native token GENIUS, an asset for a non-custodial trading platform with no meme or cultural origin at all, was flowing through the same pipeline. The September 19 directive to Checkout.com confirms the reclassification requirement, and Crossmint transactions on Fomo and Robinhood Wallet stay active only until the grace period lapses.

Crossmint’s SEC Rationale Rejected

Crossmint’s defense of the category rested on securities regulators. The firm leaned on SEC guidance under which certain memecoins are treated as collectibles under securities law — the same bucket as digital media — a rationale Fonz Olvera, Crossmint’s head of strategy, defended as logically coherent. “Compliance matters, especially now that we are a regulated financial institution, but there is always a healthy tension between business and regulation,” Olvera said during the earlier inquiry. A Crossmint spokesperson has since maintained that the company works closely with Visa, Mastercard and all payment partners, that its handling of digital goods has not changed, and that its processes will be updated if policies change.

Payments specialists reject the premise, arguing that a regulator’s legal interpretation does not automatically translate into card-network classification rules — a distinction both Chase and the New York Attorney General’s office had already made in practice. Enforcement is also tightening beyond the MCC question: tokens GENIUS and DEGEN have been dropped from Apple Pay support through the affected pipeline. Visa is expected to enforce the standard crypto asset processing flow strictly once the grace period ends, and neither Visa nor Checkout.com has commented publicly on the matter.

Mastercard’s posture is the remaining variable. The rival network has not disclosed whether it will issue a similar instruction, though its $1.8 billion acquisition of crypto payments infrastructure firm BVNK underlines how aggressively it is building in the space. For consumers the practical effect is straightforward: after the grace period, buying memecoins with a credit card through these channels loses the digital media rewards treatment entirely, and those weighing where to buy crypto can compare the best crypto exchanges directly.

Mastercard’s Move Is the Open Question

In COINOTAG’s reading, the episode marks crypto’s card on-ramp crossing from novelty into regulated routine. Enforcing MCC discipline means crypto purchases become a distinct risk category rather than disguised retail spend — and memecoins lose their cheapest acquisition incentive exactly as institutional payment rails, from Visa’s settlement pilots to cross-border networks like Stellar (XLM), professionalize. The New York probe into Crossmint remains unresolved, layering legal risk on top of the commercial reset. For a sector that has courted mainstream card rails for a decade, the message is clear: access comes on the networks’ terms, and whether Mastercard follows will determine if the rewards arbitrage closes across the entire card ecosystem.