The Cost of Crypto Cashback: Some Card Providers Subsidise Big Rewards to Win Users

By Kevin · 2026-11-02 · News

Nov. 2 (CandyPulse) — That 10% cashback on your crypto card? Someone is paying for it, and right now it's often the card company itself. A new report from CoinDesk shows several crypto card startups are taking losses to fund generous rewards, betting they can turn card users into profitable customers later through trading, lending and staking.

Key takeaways

Some crypto card providers are subsidising rewards to win and keep users
KAST advertises 8% to 12% on its Reserve account, but its backing assets yield only 3.5% to 4%; KAST covers the gap
KAST's CEO said growth spending moved the company from near break-even into losses
Bleap and Bybit EU have cut rewards; Bybit EU moved non-VIP users to a flat 1%
The bet is cross-selling, but no company has shown it's producing profits yet

Who is doing what

Provider	What's happening
KAST	Pays 8%–12% Reserve rewards on assets earning 3.5%–4%; funds the difference
Bleap	Reduced rewards; says card-only users collecting cashback can be unprofitable
Bybit EU	Cut non-VIP cashback from tiered 2%–10% (with caps) to a flat, uncapped 1%

How card rewards are really funded

There are two ways to pay for rewards:

Interchange-funded: a share of the fee the merchant pays on each purchase. These rewards are usually modest, but they can last
Subsidy-funded: the company pays rewards out of its own pocket to attract users. These can be generous, but they're often cut later, sometimes after users have moved their spending over

That's why headline rates of 10% or more often come with conditions such as staking, token holdings or paid tiers, and why they can change quickly.

What it means for you

Look at the net reward after fees and conditions, not the headline rate
Expect high promotional rates to change
Don't lock up large sums just to qualify for a higher tier unless you're comfortable with the risk

Read our guide on what a crypto card is and how it works, and see how payment giants are moving in with Visa and Mesh's crypto checkout plan. In the CANDY ecosystem, Cardaxo offers crypto spending and CANDY rewards; as with any card, check the current terms before you sign up.

What's next

Watch whether more providers trim rewards, and whether cross-selling actually turns card users profitable. More on crypto news today.

Disclaimer: This article is for information only and is not financial advice. Crypto assets are volatile and can lose value. Always do your own research before making any investment decision.