Visa ‘Monitoring’ FTX Situation After Nixing Deal With Felled Exchange

Visa has reportedly nixed its partnership with FTX about a month after the crypto exchange revealed its intent to roll out Visa debit cards to customers around the world.

FTX said last month that it was set to launch cards linked to a user’s FTX accounts in 40 countries outside of the US, where such cards were already available. The partnership intended to allow cardholders to use their crypto balance to fund purchases anywhere Visa is accepted.

The payments giant has terminated its agreements with FTX, and the exchange’s US debit card program “is being wound down,” a Visa spokesperson told Blockworks Monday.

“The situation with FTX is unfortunate and we are monitoring developments closely,” the representative said in an email.

Visa is also paying close attention to the US credit card program for BlockFi, which has also been paused, the Visa spokesperson added. BlockFi, which FTX gained the option to buy in July, suspended withdrawals last week, saying it was not able to operate as usual due to the “lack of clarity” over the evolving situation at FTX and Alameda Research.

BlockFi said Monday it was working with its partners responsible for delivering its credit card product and distributing rewards — Evolve Bank and Deserve — and would seek to offer further details soon.

Reuters reported Sunday that FTX founder Sam Bankman-Fried pulled up spreadsheets during a Nov. 7 meeting showing FTX had over time moved about $10 billion in client funds to Alameda Research, a trading firm that Bankman-Fried also founded. Between $1 billion and $2 billion of those funds were unaccounted for among Alameda’s remaining assets, according to the report.

FTX planned to roll out the FTX Card in Latin America before bringing it to Europe and Asia, Adam Jacobs, FTX’s then-global head of payments and banking, told Blockworks last month. He noted that the exchange was at the beginning of its global partnership with Visa. 

Jacobs appears to have departed from the company this month, according to LinkedIn, as FTX and roughly 130 of its affiliates began bankruptcy proceedings on Friday.

A Visa spokesperson did not comment on whether its partnerships with other crypto firms will be affected by the latest events, which have sent shockwaves through the segment.

Cuy Sheffield, Visa’s head of crypto, has said that the payments company expects digital currencies to have “a lasting impact on the future of financial services and money movement.”

Visa revealed in July 2021 it was partnering with 50 crypto platforms on card programs that allow users to convert and spend digital currency at 70 million merchants. FTX competitor Coinbase launched a Visa debit card linked to crypto accounts for users in the United Kingdom and European Union in 2019 and rolled it out to US customers earlier this year.

Gemini inked a similar partnership with Mastercard in April 2021 to offer credit cards which allow customers to spend US dollars and earn cashback in their crypto of choice.

More recently, Blockchain.com debuted its Visa card last month with 50,000 waitlist sign ups.

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