Crypto infrastructure company Crossmint is processing credit card purchases of memecoins on Robinhood Wallet and social trading app Fomo under a merchant category code meant for audiobooks and digital movies, not financial assets. The classification lets users buy tokens like WIF (Dogwifhat) through Apple Pay or Google Pay without triggering crypto-specific fees or identity checks, and it allows them to earn credit card rewards that card network rules explicitly prohibit on crypto transactions. JPMorgan Chase has opened a case with Visa over the issue, and the New York Attorney General's office says it is reviewing the matter.

The core dispute turns on a four-digit code. When a merchant processes a card payment, it is assigned a Merchant Category Code that determines how the transaction is treated. Visa and Mastercard have required since January 2018 that direct cryptocurrency purchases carry MCC 6051, a "quasi-cash" designation that most card issuers treat like a cash advance: higher fees, no grace period, and no rewards. Crossmint's Token Checkout product instead uses MCC 5815, the code for digital goods such as books, movies, and music. That classification means the transactions flow through as standard retail purchases, complete with rewards accrual and no cash-advance surcharge. Visa's rules under MCC 6051 also require a Special Condition Indicator 7 and a quasi-cash transaction indicator in both the authorization request and clearing record; Mastercard separately requires a cryptocurrency transaction identifier flag. These technical requirements leave little ambiguity about what the correct classification should be.

Chase told The Block that a Visa transaction processed through this system "was not flagged as a cryptocurrency purchase" and that the bank "believed the Visa transaction was assigned an incorrect category and should not have earned rewards." Visa issued a full statement in response: "We require participants in our network to comply with Visa's Rules. When we become aware of potential noncompliance, we conduct a thorough review of the matter and take appropriate action where warranted."

Crossmint defended the classification by pointing to the SEC's position that certain memecoins may be viewed as collectibles rather than securities, a distinction card network rules do not appear to recognize.

A Crossmint spokesperson said each supported product "goes through a detailed review and onboarding process involving the relevant partners and stakeholders before it is made available to users, which includes how transactions are categorized."

The transactions also carry no KYC check at the point of sale, meaning a user can complete a memecoin purchase through Apple Pay without any separate identity verification. That absence is notable given the regulatory direction in several major markets. The New York AG's office, which confirmed it is reviewing the situation, has noted that crypto fraud complaints to its office have nearly tripled over three years, a figure AG Letitia James cited in congressional testimony in July 2026.

FBI data cited by the AG puts cryptocurrency-related losses in the United States at $11.4 billion in 2025 alone.

The timing matters because Robinhood Chain, launched July 1, 2026 on the Arbitrum Orbit network (an Ethereum Layer 2 blockchain), generated $4.68 billion in weekly decentralized exchange volume within two weeks of going live, driven almost entirely by memecoin activity. At its peak the chain recorded roughly 200,000 daily active addresses, saw more than 140,000 first-time traders, and reached a single-day volume of $568 million, producing a 26-to-1 volume-to-TVL ratio that analysts described as far above typical DEX benchmarks. One token, CASHCAT, gained 2,158 percent in a single week to reach a market cap of around $156 million.

Fomo, described as the largest cross-chain trading application in crypto as of 2026, has 625,000 users and over $4 billion in cumulative trading volume. The company raised $75 million and holds SEC clearance for non-custodial wallet operation. It reported that weekly active traders grew sevenfold after integrating Crossmint, with more than 68,000 first-time crypto buyers onboarded in the first week.

Fomo CEO Se Yong Park described the experience as indistinguishable from everyday commerce: "Apple Pay is something that every iOS user uses in their everyday lives. The experience of buying a memecoin is no different from purchasing your morning coffee."

For users outside the United States, the stakes extend beyond a regulatory dispute. Crossmint operates across 197 countries (excluding sanctioned jurisdictions) and in June 2026 partnered with Nigerian fintech company Paga Group to bring multi-chain stablecoin infrastructure and local fiat on-ramps across Africa. Sub-Saharan Africa received more than $205 billion in on-chain value between July 2024 and June 2025, a 52 percent year-over-year increase. In many of those markets, card-level crypto classifications under MCC 6051 have historically left users facing outright blocks or punitive cash-advance fees when attempting crypto purchases with international Visa and Mastercard credentials.

A transaction coded as digital media could sidestep those blocks entirely.

That could look like expanded access, but it also arrives without the KYC layer that regulators in Nigeria and Kenya are actively requiring from digital asset service providers. Nigeria's Investment and Securities Act 2025 and Kenya's VASP Act both push in the direction of stricter identity verification, not less.

In India, where the Reserve Bank of India has been leaning toward prohibition of bank crypto exposure, transactions coded as media purchases could slip through bank-level filters, potentially creating tax liability under India's 30 percent crypto gains tax plus a 4 percent cess for users who do not realize they have made a crypto purchase at all. The same shadow-onramp dynamic is likely relevant across the broader South Asian region, including markets such as Pakistan, Bangladesh, and Sri Lanka, wherever card-level crypto restrictions exist, though specific credit card crypto data for those markets remains limited.

How regulators and card networks respond will determine whether this classification holds. If Visa forces a reclassification, users who earned rewards on these transactions could see those rewards clawed back, and the frictionless credit card onramp that drove Fomo's recent user growth would likely close. Both are scenarios that hinge on regulatory action rather than settled outcomes.

Crossmint's expansion into Africa through the Paga partnership means the outcome will affect markets well beyond the United States.