A beautifully struck ball that cannot fly far: Why did Infini close its financial card payment business?

Infini has always been well-received by users due to its simple interface, stable financial management, and smooth payment services (U card). This card allows users to store stablecoins and pay for daily expenses through Visa, seen as an important breakthrough for Web3 payments.

However, according to Infini's official announcement and co-founder Christine's statement, operating a payment card not only requires high compliance costs, manpower, and technical maintenance expenses, but it is also nearly impossible to generate a stable source of profit.

Image source: X

This process is too tortuous, too lengthy, and too costly. Without subsidies, it is impossible to achieve the same handling fees and rewards as Web2 credit cards.

In other words, even if the product experience is excellent, as long as the card still relies on the traditional financial system (such as bank clearing and payment networks), the ideals of Web3 are ultimately constrained by the iron cage of Web2.

Struggling to move forward: Why is cryptocurrency payment difficult to scale?

Christine explained from an operational perspective that the financial card business itself has multiple 'intermediary barriers'.

  • Stablecoins must first be converted into specific intermediary assets before being further transformed into fiat currency for consumption through traditional payment networks.

  • The entire process involves cumbersome steps such as regulatory risk control, KYC, and AML auditing.

  • Nearly every layer extracts handling fees, and the final cost is still much higher than existing Web2 credit cards.

He likens this payment model to 'iPod nano', seemingly attractive but ultimately destined to be replaced by 'iPhone' and other more essential and native Web3 solutions.

The U card is not the ultimate solution for 'paying with stablecoins', but merely a transitional path, and it has now been confirmed that this path is not worth pursuing any longer.

Wu Blockchain: Cryptocurrency financial cards cannot escape the fate of burning money.

Infini's financial card is well-known in the Asian cryptocurrency circle. Although it was previously hacked for $50 million due to a permissions transfer oversight, the team's commitment to full compensation is commendable.

Further reading
On-chain hackers turn insider? Infini hacked for $50 million, founder angrily declares: Legal accountability to the end!

However, as Colin Wu, the editor of Wu Blockchain, said: 'The U card is indeed difficult, it is trapped in traditional finance; no matter how well you optimize the user experience, it is of no use.'

If Web3 native entrepreneurs want to issue cards, they still need to rely on core clearing networks like Visa or Master, and cannot bypass the strict scrutiny of banks and acquiring institutions. This means that even if cryptocurrency operators are willing to take risks and drive innovation, the traditional financial system still erects a high wall of 'cost' against cryptocurrency payments.

This has also led to a sluggish entrepreneurial ecosystem in the current cryptocurrency industry, where high costs force teams with real products and execution capabilities, such as Infini, to choose to stop losses and transform.

Infini embraces a decentralized future and focuses on financial products.

The Infini team emphasized in the announcement that financial services and asset deposit and withdrawal functions, other than the card, are still operating normally. In the future, they will focus on developing asset management products. More importantly, they will 'abandon centralized paths' and fully embrace decentralized payment solutions.

This may indicate that Infini will explore turning to cryptocurrency-native products such as wallets or yield management applications that do not rely on banks. Instead of getting stuck in the cost-burning limbo between Web2 and Web3, proactively turning towards more autonomous cryptocurrency solutions may be the best answer.

In this battle of payments, Infini's withdrawal is not a failure, but rather an expensive lesson. Web3 entrepreneurs should also rethink the true path of 'payment': whether to imitate Web2 or create an entirely new financial interaction logic.

  • This article is authorized for reprint from: (Chain News)

  • Original title: (Infini announces the closure of cryptocurrency financial card services: Is the U card doomed to be trapped by traditional financial payment paths?)

  • Original author: Crumax

'Infini shuts down cryptocurrency financial card services! Why can't the U card succeed? The founder reveals 3 major obstacles.' This article was first published in 'Crypto City'.