KYC Comes for Crypto Cards as SolCard Shuts Door on Anonymous Visa Use – Crypto News

SolCard, a Solana-focused debit card platform that gained popularity by offering users an easy way to spend their crypto without Know Your Customer (KYC) requirements, quietly removed its key feature last month, veiling the move as an upgrade. However, a spokesperson for SolCard tells The Defiant that the move is only temporary.

“We plan to remain non-KYC,” the SolCard spokesperson said, adding, “We will be back up and operating with non-KYC soon,” without specifying the timeframe.

Last month, many SolCard users who had not verified their identities on the platform discovered that their virtual Visa cards had vanished from the SolCard mobile app.

A June 18 company update from SolCard introducing what the team calls “SolCard Full Access” sheds some light on the situation. The Full Access tier for SolCard users requires identity verification. The SolCard team also stated that it will only issue new Visa cards, which support Apple Pay and Google Pay, to users in the new “verified tier,” citing a requirement from its banking partner.

“We had SolCard Full Access planned for later this year, but our bank needed us to launch it now to keep offering Visa cards,” the team said in the announcement.

In a June 26 post on X, without mentioning the KYC requirement directly, the team clarified that users who had lost access to their virtual debit cards could withdraw their funds, saying, “If you’ve had a card cancelled or frozen, you may request a USDT withdrawal and receive it INSTANTLY, starting right now.”

SolCard’s no-KYC Visa

The SolCard Full Access announcement also notes that any frozen Visa cards allow fund transfers or refunds, and users have the option to upgrade to Full Access — meaning verify their identity — to unfreeze them. Mastercard issuance and fees remain unchanged and do not require KYC, though those cards do not support Apple Pay or Google Pay.

“We’re committed to bringing back a privacy-centered IRL solution in the near future. However, our current priority is working closely with banks and partners to stabilize our Visa offering. This means our efforts are temporarily focused on meeting reliability standards set by the issuing institutions,” the SolCard team added.

Before the change, anyone could generate a virtual Visa card with no identity checks. Users paid a 5% fee to top up their cards with SOL, USDT, or USDC, and a 2% fee on foreign currency purchases, with a monthly cap of $10,000.

Balancing Compliance and Privacy

Jamie Elkaleh, chief marketing officer at Bitget Wallet, told The Defiant that SolCard’s shift was “entirely expected” as it’s “in line with broader financial trends,” noting that authorities worldwide are “tightening regulations.”

“FATF’s Travel Rule, Europe’s MiCA, and US agencies such as FinCEN are increasingly focusing on identity verification in crypto transactions. As a Visa/MC issuer, SolCard would face rising compliance demands. Offering non‑KYC cards amplifies fraud, money laundering, and sanctions evasion risks. Card networks and partner banks are unlikely to sustain this indefinitely, and the operational overhead becomes harder to justify,” Elkaleh said.

Gal Arad Cohen, a partner at the Israeli crypto law firm S. Horowitz & Co., said in a commentary for The Defiant that as crypto adoption gains momentum and an increasing number of centralized actors enter the market, regulatory compliance is becoming a crucial, if sometimes complex, factor for those aiming to operate in multiple jurisdictions.

She and Ilya Keselman, an associate at the firm, noted that greater compliance could help boost user trust and support growth, but cautioned that regulation shouldn’t come at the expense of crypto’s foundational principles. “This isn’t a one-way street,” they said.

“As the ecosystem evolves, we expect to see more decentralized solutions leveraging technologies like DeFi protocols, immutable smart contracts, and non-custodial wallets, alongside more privacy-preserving tools such as zero-knowledge proofs, self-sovereign identity, and on-chain compliance layers,” they said, adding that those technological solutions may offer a path to balance regulatory requirements such as AML, CTF, and sanctions compliance with the crypto community’s core value of privacy.

On July 3, SolCard clarified in another X post that “all users have been able to withdraw their funds if they chose to do so,” adding that the team is now working on “SolCard v2,” though details weren’t disclosed.

SOLC, SolCard’s native token, dropped nearly 87% on June 18, the day SolCard’s Full Access announcement was published, and has been trading sideways since then.

No-KYC Space ‘Shrinking Fast’

SolCard isn’t the only KYC-free crypto-funded debit card out there, as other virtual cards like BingCard and Laso Finance, among others, also offer cards that don’t require ID verification. These cards have gained popularity among users who want to maintain their privacy or avoid detection by tax authorities.

BingCard and Laso Finance did not respond to The Defiant’s request for comment.

According to multiple posts on social media from anonymous accounts, some users view KYC-free cards as a means to circumvent capital controls or spend cryptocurrency more freely, particularly in regions with stringent reporting requirements.

The tradeoff comes in the form of high fees, like SolCard’s 5% top-up fee and 2% fee for foreign purchases. Similar cards, such as PlasBit, have comparable or even higher fees. The lack of ID checks means providers take on more risk and pass those costs onto users.

Still, SolCard stood out as one of the few focused specifically on the Solana ecosystem and offered a 50% referral discount on issuance fees.

Raagulan Pathy, founder of rival crypto card KAST, predicted in an X post on June 26 that “more and more card programs will shut down,” arguing that most crypto firms aren’t built to deliver fintech products.

Elkaleh acknowledged that while there remains some room for non-KYC crypto solutions, “that place is shrinking fast, both technically and legally.”

“There’s still a niche for such products because non-KYC cards give easy crypto access to the unbanked. Billions globally lack verifiable ID or access to centralized banking. Non-KYC cards offer a way to spend crypto without needing formal documentation, especially in regions with weak infrastructure,” he said, noting that some users turn to non-KYC cards to test usability or bridge short-term liquidity before transitioning to more regulated platforms.