Cardless, a company that has facilitated credit cards for brands like Qatar Airways and Alibaba, said it has developed a payment card in collaboration with crypto exchange Coinbase (COIN) for stablecoin holders who cannot obtain one through traditional channels.
The secure Coinbase stablecoin product is intended for situations where a regular credit card cannot be approved on an unsecured basis, but the applicant holds digital assets on the exchange, said Michael Spelfogel, co-founder of Cardless. Some of their stablecoin holdings are set aside as collateral against debt.
“People are applying across all parts of the credit spectrum,” Spelfogel said in an interview. “Some people want to use this method because they believe in cryptocurrencies, but they are just beginning their journey and accumulating wealth.”
Cardholders, who pay $49.99 for the privilege, still earn a yield on their sequestered USDC holdings, Spelfogel said.
The product builds on a partnership that began in September, when the companies introduced a Coinbase-branded card in association with American Express (AXP). This card offered up to 4% cashback in Bitcoin . Cardless declined to say how many cards have been issued.
Traditional credit programs are slow, inflexible systems designed around banks that left billions on the table because businesses never had the tools to design credit on their own terms, according to Cardless.
