Visa tightens rules to block rewards on meme-coin buys

Visa announced in a policy update that it will change how transactions involving certain cryptocurrencies are coded on its global payments network to stop cardholders from earning credit-card rewards when they buy meme coins and some other digital tokens.

Under the update, Visa will work with card issuers and payment processors to reclassify or exclude some crypto-related purchases from rewards programs. Transactions for specified tokens may be routed through merchant category codes or flagged with attributes that make them ineligible for points, miles or cash-back.

Card issuers set rewards rules while card networks determine merchant category codes and transaction attributes. By changing how crypto purchases are classified, Visa’s update gives issuers a clearer path to deny rewards on token buys. The change applies across Visa’s network and could affect purchases made through exchanges, brokers and in-app services worldwide.

The immediate effect will be that some cardholders who previously received rewards on meme-coin purchases will no longer earn them. Banks that had high payouts linked to reward programs may see reduced costs. Payment processors and crypto platforms that want customers to keep earning rewards will need to alter how purchases are routed and reported, or accept that such purchases will be treated differently.

Industry participants had used routing and merchant codes to preserve reward eligibility for crypto purchases, including by leveraging promotional bonuses and elevated reward categories. Visa’s update clarifies which transactions qualify for rewards and provides issuers authority to treat specified crypto charges as excluded.

Meme coins are volatile, speculative tokens traded on exchanges and some payment apps. Credit-card rewards programs commonly exclude cash-like transactions; Visa’s coding changes align network classifications with issuers’ ability to enforce those exclusions. Several card companies have already revised cardholder agreements or blocked crypto purchases from earning rewards, and the network update will set clearer limits for future transactions.