Author: Firefly (Chinese)

Entering 2026, the global cryptocurrency market is undergoing a profound structural reshaping. According to a survey by TRM Labs , global retail crypto activity fell 11% year-on-year to $979 billion in the first quarter. While this may appear to be a cooling trend, beneath the surface, fund flows and user behavior are shifting: funds and user behavior are moving from pure speculation towards areas such as stablecoin settlements, on-chain payments, and decentralized identity.

In many people's minds, cryptocurrency is still equated with speculation, hoarding, and DeFi mining. But in reality, from New York restaurants to Singapore cafes, from paying at Haidilao hot pot restaurants to entering music festivals, more and more everyday scenarios can be paid for with crypto assets just like swiping a credit card. Just a year or two ago, buying a cup of coffee with cryptocurrency involved OTC currency exchange, incurring about 2% exchange rate losses, and the risk of having your card frozen. Now, simply open the crypto card app, deposit USDC, and scan the code to complete the transaction.

This is the change that Consumer Crypto is driving: transforming blockchain from a geek tool into an everyday service that ordinary people can experience. It unfolds along two lines: one focuses on privacy protection, such as e-commerce using encryption to conceal user information; the other focuses on seamless experiences, integrating NFT tickets, tokenized loyalty rewards, and on-chain social interaction into high-frequency life scenarios.

Around this goal, a multi-layered ecosystem is gradually taking shape:

• Payment Layer (Crypto Card): Based on stablecoins, it opens up a channel between on-chain assets and offline consumption.

• Consumer layer (applications): such as Blackbird and RaveDAO, turning catering and entertainment into on-chain scenarios.

• Identity Layer (Decentralized Social Applications): Reconstructing digital identity and social relationships to provide a portable trust foundation for consumption behavior.

These three layers outline an evolutionary path: crypto assets transform from numbers on a screen into money in your pocket, and further, make each user an "identity on the blockchain with portable credit." However, the convenience comes at the cost of friction caused by KYC (Know Your Customer). It is both the cornerstone of compliance and the most concentrated pain point in current user experience.

This article attempts to explore the core question that arises from this: In the three-layer architecture of encrypted payments, consumption, and identity for consumers, can KYC be transformed from an obstacle of repeatedly submitting documents into a reusable, low-friction, and user-controlled identity verification service? This may be the key to whether cryptocurrency can truly enter the daily lives of 1 billion people.

I. Encryption Cards: A Bridge Connecting On-Chain Assets and the Real World

1.1 What is an encryption card? Why do we need it?

A crypto card is essentially a prepaid card, debit card, or credit card that supports cryptocurrency deposits. Users deposit stablecoins such as USDC and USDT into the card, and when the card is swiped, the system converts them into local fiat currency at the real-time exchange rate, making the experience almost indistinguishable from a regular Visa or Mastercard card. Merchants receive fiat currency and are even unaware of the existence of the crypto assets. Therefore, crypto cards have become the most direct channel connecting on-chain assets with offline consumption.

The rapid adoption of encrypted cards stems from their precise solution to the core pain points of users in different regions.

● Avoid the risks of over-the-counter (OTC) transactions: Bypass the exchange rate losses (usually around 2%) and the ever-present risk of frozen bank accounts when withdrawing funds from OTC accounts, and achieve safe and direct real-time exchange rate deductions.

● Reshaping Financial Infrastructure in Emerging Markets: In regions like Latin America, Southeast Asia, and the Middle East and Africa, facing high local currency inflation, capital controls, or fragile banking systems, crypto cards have become a key tool for ordinary people to obtain "digital dollars" and directly access global merchant networks. Service providers such as Redotpay , Kast, and Holyheld are representative of this approach.

1.2 Market Size: Growth Far Exceeding Expectations

The crypto card market is expanding rapidly and has reached a scale comparable to traditional P2P stablecoin transfers. According to data from Artemis Research , monthly crypto card transaction volume surged from approximately $100 million at the beginning of 2023 to over $1.5 billion by the end of 2025 (a compound annual growth rate of 106%). In March 2026, monthly transaction volume further increased by 211% year-on-year.

Source: Artemis Research

Behind this frenzy, the two payment giants, Visa and Mastercard, played a key role in driving the event.

● Visa (market share over 90%): Adopting an "infrastructure" strategy, through deep cooperation with suppliers such as Rain and Reap, it can cover dozens of downstream card issuers with a single integration, and quickly capture market growth.

● Mastercard : Focuses on directly linking with centralized exchanges with large user bases (such as Revolut and Bybit). In March 2026, it further signaled its significant investment by acquiring stablecoin infrastructure company BVNK for $1.8 billion.

1.3 Overview of Mainstream Encryption Card Products

Currently, encrypted payment cards on the market can be divided into four major camps based on their underlying architecture and business logic, with significant differences in functional focus and KYC models among the camps. Meanwhile, a new trend is rapidly taking shape in the Asia-Pacific and Latin America regions: stablecoin QR code payments are expanding the offline scenarios for encrypted payments through a lighter approach.

Category 1: CEX Co-branded Cards – An Extension of Exchange Traffic

These cards are deeply integrated with exchange wallets and are mostly prepaid or debit cards, some of which support cryptocurrency cashback, aiming to open up consumption outlets for funds held on the platform. Representative products include Bybit cards , Binance cards , Coinbase cards , and the recently upgraded Gate card .

These cards directly inherit the exchange's authentication system for KYC. They are almost imperceptible to exchange users who have already completed advanced authentication, but pose the first hurdle for newcomers, requiring proof of identity, facial recognition, and address.

Taking the Bybit card as an example, it supports KYC verification in mainland China, but requires completion of exchange level 2 verification (ID card + face). There is no annual fee, and it can be linked to Apple Pay or Google Pay. The overall fee rate is about 0.9% to 3%, and a 10% cashback is offered during the promotion period. In early 2026, the EU version launched the BTC cashback function.

Source: Bybit

Binance Card and Coinbase Card represent different trade-offs. Binance Card is heavily influenced by the regulatory environment, having been suspended in some regions. KYC is highly tied to exchange accounts, making compliance quite challenging. Coinbase Card, on the other hand, is more geared towards the US market, requiring bank-level identity verification, which adds an extra layer of difficulty for non-US users in applying for and using the card.

In contrast, the Gate card, launched in March 2026, seems tailor-made for current payment habits. It offers up to 5% cashback, supports BTC, ETH, USDT, or GT, with a 1% transaction fee. Advanced users have the opportunity to offset transaction costs with cashback, achieving net profit, with a monthly cashback cap of 250 USDT. In 2026, when contactless payments are the default experience, the Gate card is compatible with NFC terminals and Apple Pay and Google Pay from the outset, eliminating the need for physical card swiping.

Source: Gate

Category 2: Self-custodied/Protocol Native Cards – Payment Vehicles of the DeFi Spirit

These types of cards emphasize absolute control over users' assets and cleverly integrate DeFi features, such as DeFi yields or collateralized lending. Representative products include the Ether.fi Cash Card , MetaMask Card , Phantom Card , Ready Card , and UR Card .

Among them, the Ether.fi Cash card achieves a differentiated breakthrough through its "spend-earnings" model. Users can directly use the earnings generated from staking eETH for consumption and repayment, thus creating a closed loop of "earning interest on holding cryptocurrencies + daily expenses." This design significantly improves the efficiency of capital utilization and has also driven its rapid market penetration. Currently, it contributes nearly half of the transaction volume of crypto-native payment cards, with approximately 70,000 active cards and 300,000 accounts. In addition, in early 2026, the Ether.fi DAO approved a $50 million ETHFI buyback and migrated from Scroll to the OP Mainnet in February to optimize performance and liquidity.

Source: Ether.fi Cash

In contrast, MetaMask Card represents a wallet giant's path into the payment gateway. Its Little Fox Card, launched in partnership with Mastercard, opened nationwide in the US in February 2026, directly embedded within the wallet ecosystem and processed through Linea. In terms of product design, the virtual card offers 1% cashback, while the metal card offers 3% (annual fee of $199), with a daily spending limit of up to $15,000. Cardholders also enjoy exclusive Web3 benefits such as travel and dining. Backed by official backing, its payment success rate and compliance performance are particularly outstanding, making it one of the on-chain payment solutions closest to the traditional financial experience.

Source: MetaMask Card

In addition, Ready Card employs account abstraction technology, emphasizing zero foreign exchange fees and zero top-up fees, and attracts users with STRK rewards worth up to $1,800 per year. UR Card, on the other hand, further integrates multi-currency IBAN accounts and interest-earning capabilities, evolving towards a "licensed bank account" model.

While these cards emphasize decentralization and privacy protection in their concept, their practical implementation is still constrained by the compliance requirements of issuing institutions and card organizations. At the KYC level, users usually still need to complete identity verification. For example, MetaMask Card requires an SSN in the United States, and Phantom Card also has clear geographical restrictions, such as not being open to users in China. This practical constraint highlights the core contradiction of the current situation of "decentralized protocols but centralized entry points."

Category 3: Crypto-native New Banks – Reconstructing the Web3 Account System

These products attempt to build a complete banking account system around crypto assets. Representative products include Fiat24 and KAST .

Fiat24 is a Web3 banking protocol based on Arbitrum, regulated by the Swiss FINMA. It provides users with independent IBAN accounts and Mastercard debit cards through wallets such as SafePal and imToken. It supports automatic currency conversion after depositing USDT/USDC, and can also be linked to Alipay and WeChat Pay. The overall fee rate is approximately 0.6% to 1%, making it a compliant, deep-market cryptocurrency card with exchange resources. The platform has since been acquired by a leading exchange.

KAST was the most talked-about new player in terms of funding in 2026. Founded by a former Circle executive, it completed an $80 million Series A funding round in March (valuing the company at $600 million), boasts an annualized transaction volume of approximately $5 billion, and has over 1 million users. Key highlights include a 1:1 USDT/USDC exchange rate with the US dollar, a US bank account, coverage in over 190 countries with no foreign exchange fees, and up to 12% cashback (some cashback in MOVE tokens). Its IP collaboration strategy is also unique, partnering with Pudgy Penguins to launch the "Pengu Card," attempting to bring Web3 brand recognition into everyday consumer finance.

Source: KAST

Regarding KYC (Know Your Customer) procedures, these products follow the compliance channels of traditional banks or e-money institutions, which have the highest requirements. Fiat24 requires a passport and proof of address, described by Chinese-speaking users as a "Schengen visa reappearance." KAST requires verification of a US bank account identity, and overseas users are often rejected due to their inability to provide proof of address or SSN (Social Security Number), earning it the nickname "First World Exclusive Card" in the community. This highlights the inherent tension between global expansion and compliance requirements for crypto-native banks.

Category 4: Traditional Fintech New Banks – Encrypted Extensions of Existing Platforms

These products combine encryption functionality with established digital banking platforms, offering both a traditional banking experience and support for crypto assets. Representative examples include Revolut and DCS Card Centre + Standard Chartered Bank.

Revolut has a large user base in the EU and the UK, with encrypted cards embedded in digital bank accounts, making KYC and learning costs extremely low.

DCS Card Centre (formerly Diners Club Singapore) is a prime example of the deep integration of traditional finance and stablecoin payments. In May 2025, it partnered with Visa to launch the DeCard prepaid card, supporting USDT and USDC top-ups. In November of the same year, it partnered with Standard Chartered Bank to launch the DeCard stablecoin credit card, with Standard Chartered providing virtual accounts and API interfaces, initially launched in Singapore. Standard Chartered's direct involvement signifies that stablecoin payments have moved from peripheral experiments into the strategic business line of traditional banks.

The KYC process for these cards is no different from opening a regular bank account. It's extremely user-friendly for existing bank account holders, but poses a barrier for users who only use USDT. Interestingly, thanks to the bank-level risk control system, the approval rate for these cards is actually higher than for purely crypto-based native cards.

1.4 Extension: QR Code Payment – ​​Another Way to Bypass Physical Cards

Parallel to the development of crypto cards is the rapid rollout of stablecoin QR code payments. Compared to relying on traditional card organizations, in markets where QR codes are highly prevalent, such as the Asia-Pacific and Latin America regions, directly connecting to local payment networks is becoming another efficient path to facilitate off-chain consumption.

Behind this trend lies a structural shift in payment habits. Juniper Research predicts that global QR code payment transaction volume will grow from $5.4 trillion in 2025 to over $8 trillion in 2029, with Asia contributing over 60% of the transaction volume, and emerging markets such as Vietnam, Indonesia, and the Philippines continuing their rapid growth. QR code payment volume in this region is projected to grow by 300% by 2029. The Latin American market is also performing strongly; for example, Brazil's Pix system surpassed 7 billion transactions in December 2025. Against this backdrop, directly embedding stablecoins into local QR code systems is no longer a technological experiment, but an inevitable choice to adapt to user habits.

Following this path, the industry has gradually differentiated into two different implementation methods:

1. Direct access between wallets and exchanges

Players like Bitget Wallet and Gate Pay choose to directly connect to local QR code networks in various countries. In this process, AEON, a third-party payment gateway with deep involvement from the Alchemy Pay core team, plays a crucial bridging role. Leveraging the aggregation capabilities of such gateways, Bitget Wallet and Gate Pay have successively connected to VietQR in Vietnam, GCash in the Philippines, and Pix in Brazil, rapidly completing their merchant deployment in lower-tier markets.

In early 2026, Bitget Wallet further launched its Onchain Payments Matrix , integrating Ripple, Mastercard, Visa, Tether, Circle, and MoonPay, connecting over 150 million merchants in 50 markets and covering over 2.5 million merchants in the Asia-Pacific and Latin America for QR code payments. In April of the same year, its QR code payment service expanded to the entire Asia-Pacific region , supporting USDT/USDC payments on more than ten networks including Solana, BNB Chain, and Ethereum, and planned to expand the number of acceptable tokens to over 1,000.

The advantage of this approach lies in its rapid expansion and wide user reach, but it also inevitably faces friction caused by cross-system integration. For example, in some non-standard QR code scenarios, "last mile" problems such as settlement delays may still occur.

2. Restructuring payments within the regulatory framework

In markets with higher compliance requirements, stablecoin QR code payments do not pursue rapid expansion, but rather emphasize controllability and transparency. Taking Singapore as an example, the collaboration between OKX, StraitsX, and Grab is incorporated into the Monetary Authority of Singapore's (MAS) Use-Based Funds (PBM) framework. Every fund flow is constrained through smart contracts and is visible to regulators to the necessary extent. While this model is slower, it provides a replicable paradigm for the long-term implementation of stablecoin payments in highly regulated environments.

Overall, QR code payments and encrypted cards are not substitutes for each other, but rather a natural complement based on regional habits. The former penetrates the capillaries of daily consumption in the Asia-Pacific and Latin America with its extremely low merchant onboarding costs, while the latter continues to consolidate its dominance in traditional POS networks in Europe and the United States. Both ultimately aim to reduce the intermediate exchange links between on-chain funds and real-world consumption.

1.5 The Dilemma of KYC: The Tug-of-War Between the Cornerstone of Compliance and the Killer of User Experience

While encrypted cards have achieved a seamless transition from on-chain to offline payment, the card activation process remains highly challenging. Regardless of their underlying logic, all four product categories face the same hurdle at the Know Your Customer (KYC) stage.

For card issuers, strict KYC is not intentional obstruction, but a "compliance red line" that is a matter of life and death. With the FATF (Financial Action Task Force) "Travel Rules" implemented in more than 85 jurisdictions worldwide, and the subsequent implementation of the US GENIUS Act and the EU MiCA Act, anti-money laundering (AML) and identity verification have become hard survival indicators. Card issuers have no choice but to walk a tightrope between the high pressure of regulation and user complaints.

However, this downward transmission of regulatory pressure makes users the most direct beneficiaries, manifesting in three major pain points:

● Document Hell: Passports and proof of address have strict formats and sometimes require translation and notarization. Many native crypto users have never handled these traditional documents before.

● Regional discrimination: Many encrypted cards directly block specific countries or regions, so even those with valid passports may be refused service due to their nationality.

● Privacy Paradox: Users choose encrypted cards to protect their financial privacy, but KYC forces them to hand over their identity information to third parties, and the risk of data leakage is real.

Overall, the value of crypto cards as the payment foundation between Web3 and the real world is undeniable. However, the high barriers of KYC (Know Your Customer) are limiting their transition from a "niche celebration in the crypto world" to a "mass-market everyday tool." But a turning point is brewing. In the future, as on-chain identity verification, zero-knowledge proofs, and tiered KYC solutions mature, crypto cards are expected to achieve lower-friction activation and use within a compliant framework, truly becoming the primary entry point for ordinary people to access Web3 for everyday consumption.

II. Consumer Encryption Applications: On-Chain Reshaping of Scenarios

If encrypted cards solve the channel problem of "how to spend money", then consumer encrypted applications answer a more everyday question: "Where is the money spent, and why is it spent on the blockchain?"

By 2026, the reach of consumer encryption had extended beyond basic payments to high-frequency scenarios such as dining, ticketing, and gift cards. The underlying business logic was no longer mere hype, but clearly pointed to two main themes: breaking down the closed ecosystem of points systems and rebuilding trust in easily forged ticketing services.

2.1 Composable Loyalty: From "Isolated Points" to Cross-Brand Distribution Networks

Traditional loyalty programs have long faced a dead end: points from different brands are not interchangeable, leaving users with a pile of soon-to-expire "digital junk," while merchants cannot see the full picture of their customers. Web3's solution is to transform points into on-chain assets that users hold themselves and that can circulate across brands.

The restaurant industry serves as the most direct testing ground for this logic. A prime example is Blackbird, an L3 network based on the Base blockchain. Its users earn $FLY tokens after dining at participating restaurants, which can be used as a payment method at any establishment within the network. Currently, the network covers approximately 1,000 restaurants in New York, San Francisco, and Charleston.

Blackbird abandons the single-token model, which is prone to a death spiral, and adopts an innovative dual-token architecture:

● $FLY (Stable Credit): Peged to $0.01, it serves as a universal payment and reward method within the network, eliminating concerns for merchants and consumers regarding price fluctuations.

● $F2 (Governance Token): Used to pay network gas fees and for ecosystem governance (fixed cap of 1 billion tokens).

In 2026, Blackbird launched its hardware terminal, "Flycar," which linked on-chain identity with offline payments and partnered with MetaMask cards to offer up to 5x FLY rewards. For users, this is a cross-store universal points alliance. For restaurants, it's a powerful tool for identifying high-value customers at extremely low cost and getting rid of the high commissions charged by food delivery platforms.

This "universal building block" logic is rapidly expanding. For example, Raise Network on Solana launched the programmable on-chain gift card SmartCard, which has already processed over $5 billion in gift card transactions, and its $RAISE token is expected to launch in the first half of 2026. Furthermore, in early 2026, IRL launched a cross-venue loyalty network where users can earn points and tokens by checking in at cultural spaces in multiple cities worldwide via NFC; the network already covers over 40,000 members. These projects all share the same underlying vision: to make consumption patterns portable across brands.

2.2 Verifiable Access Rights: On-chain Experiments of Ticketing and Equity

If excessive fragmentation is a long-standing problem with points systems, then counterfeit tickets and scalpers are decades-old ailments in the ticketing industry. Casting tickets into NFTs—unalterable tokens with full traceability for resale—is the most direct anti-counterfeiting measure.

In 2026, multiple on-chain ticketing solutions accelerated their implementation in this direction:

● Mingo (Hedera Chain): An NFT ticketing platform that charges 1/5 the transaction fees of traditional platforms and has partnered with event organizations such as the WBC and the African Boxing Federation to issue thousands of sports and event tickets in 54 countries.

● Celebratix (Solana Chain): Offers a complete ticketing suite covering primary sales, secondary markets, guest lists, and loyalty programs, and has partnered with several major venues, including Amsterdam and Hamburg.

● The fate of traditional giants : Coachella, Tomorrowland (in partnership with Bybit Card), and Ticketmaster have all begun testing the use of NFT tickets to unlock VIP experiences, priority ticketing rights, and exclusive merchandise.

However, the consumer application sector, seemingly possessing "real revenue," is not without its pitfalls. RaveDAO constituted one of the most dramatic risk events of 2026. The project had successfully hosted over 20 on-chain electronic music festivals, attracting over 100,000 participants and generating millions of dollars in revenue. But in April 2026, its token, RAVE, surged to nearly $28 (FDV exceeding $14 billion) in just 11 days, followed by a 96% avalanche within 48 hours. On-chain detective ZachXBT revealed that approximately 90% of the token supply was concentrated in wallets linked to the team. This served as a wake-up call for the market: no matter how realistic the application scenario, if the token model suffers from severe supply concentration and circulation mismatch, it is highly susceptible to becoming a tool for capital manipulation.

2.3 Trial and Error and Evolution: The "Survival Rules" of Consumer Encryption

The implementation of consumer encryption has never been smooth sailing; the industry is constantly demystifying itself through trial and error.

● Starbucks' Odyssey NFT loyalty program, which it launched with great fanfare in 2022, was shut down in 2024 due to its complex concept and high barriers to entry.

● Mercado Pago (a platform under the Latin American e-commerce giant) shut down its four-year-old cashback cryptocurrency Mercado Coin in March 2026 and pragmatically switched to the more widely accepted US dollar stablecoin Meli Dolar.

These cases repeatedly validate a principle: for consumer crypto applications to survive, they must either genuinely reduce costs, such as Blackbird reducing processing fees from 4% to 2%, or address real pain points, such as on-chain ticketing anti-counterfeiting, or allow consumer behavior to be converted into portable on-chain assets. Simply repackaging traditional points with blockchain technology or performing financial engineering on a token model, no matter how exciting the short-term narrative, will ultimately lead to user abandonment.

III. Decentralized Social Networking: The Source of Trust

As mentioned earlier, encrypted consumer applications are enabling points to circulate across stores and tickets to be verified for authenticity. However, all of this depends on one prerequisite: the system needs to know "who you are" and be able to determine "whether you are trustworthy," rather than requiring you to submit a copy of your passport every time.

Traditional internet platforms have delegated this task to centralized platforms. Alipay knows your credit score, Meituan knows your preferences, and this data is kept in isolation. Merchants who want to identify a high-value new customer have to repeatedly buy traffic from the platform. Meanwhile, users who want to transfer their positive customer reputation to another store have nowhere to go.

Web3 offers another approach: allowing users to aggregate their own identities and selectively disclose them to parties requiring verification. However, on-chain identities are currently extremely fragmented; the same person may hold dozens of wallet addresses, with different social graphs and NFTs across different protocols. The question then becomes: what infrastructure is needed to piece together these scattered traces into a usable "digital business card"?

By 2026, this direction began to move beyond the feasibility verification stage, giving rise to more concrete product forms: decentralized social applications. Each of these applications addresses a dimension of the trust chain, and together they form a verification loop: identity verification, community activity, and information judgment. The combination of these three elements gradually gives "an address" the outline of "a person."

3.1 How to verify identity: Keeping privacy in the hands of users

The first hurdle for on-chain applications is distinguishing between a human and a machine behind an address. Users don't want to repeatedly submit their passports, while platforms need to verify the identity of the person to prevent fraudulent transactions. Ideally, there would be a place that can both piece together scattered fragments of identity into a complete digital profile and attach a credible "real person" tag.

The identity aggregation platform Web3.bio is evolving in this direction. By mapping isolated IDs from different ecosystems such as ENS, Lens, and Farcaster into a unified graph, and deeply integrating wallet assets, NFTs, POAPs, and DAO participation records, it generates a digital business card with "on-chain credibility" for users. This not only solves the puzzle of "who you are," but also gives the digital image behind the address an assessable level of trust.

Source: Web3.bio

At the "Are you a real person?" level, Web3.bio has adopted a pragmatic aggregation approach. Currently, the platform has successfully integrated KYC information from compliant trading platforms such as Binance and Coinbase, using wallet scenarios as the initial entry point for verification data integration. However, this is only the first step in building an identity network. With its recent deep strategic partnership with the decentralized identity protocol Sign, Web3.bio 's long-term goal is to continuously aggregate more multi-dimensional and highly reliable verification information, making identity data truly the underlying infrastructure for "one-time verification, multi-party reuse."

The significance of this model lies in its outlining of a technological shift for on-chain KYC, moving from "repeated document submissions" to "seamless credential reuse." For application developers, a single API can simultaneously verify a user's authentication status and identity graph, eliminating the need for redundant KYC process development. For users, control over their identity data is regained, enabling selective information disclosure. This trust system, balancing efficiency and privacy, is crucial for the large-scale deployment of consumer encryption applications.

3.2 Where does community activity come from: lightweight, gamified, high-frequency interactions

Authentic identity is merely the foundation; trust requires depth. In the traditional internet, a person's consumer influence can be glimpsed from their social media activity and number of followers. But in Web3, this depth comes from a user's daily actions within their interest-based communities. Orb, built on the Lens protocol and boasting over 50,000 monthly active users, is a typical product embodying this approach. It avoids complex financial functions, instead minimizing the barrier to entry for interaction. For example, posts can be crafted into digital collectibles, interaction relies on sticker packs, and the tipping function is seamlessly integrated.

Source: Orb

The most community-oriented design is Orb Clubs. It allows users to create small communities around shared interests such as electronic music and photography, set their own rules, and establish a community treasury in the future. The frequency of a member's participation and the role they play in the club naturally become quantifiable evidence of their influence on the community and its stickiness.

Source: Orb

3.3 How information flows: Integrating prediction markets and social media into a single timeline

With a verified identity and active community, the remaining issue is judgment. In consumer scenarios, a user who consistently and accurately predicts restaurant popularity and demonstrates discerning taste in community polls carries more weight in their recommendations.

Firefly's solution integrates social and on-chain activities into a single timeline. As a Web3 social aggregator, Firefly aggregates information streams from X, Farcaster, Lens, and Bluesky. It also incorporates on-chain activities such as Polymarket predictions, Snapshot voting, and NFT collecting into its interface.

Source: Firefly

In early 2026, Vitalik Buterin publicly stated that all his posts and reads that year were done through Firefly, covering multiple licenses.

Source: Vitalik Buterin X account

The implication of this design is that on traditional platforms, a user saying "This restaurant will be popular" is simply a deleteable comment. However, on Firefly, the same judgment, if accompanied by Polymarket betting records, becomes a publicly verifiable on-chain prediction. If consumer applications integrate these signals, identifying high-value consumers can go beyond transaction volume and also consider the accuracy of their judgments. The information flow thus extends from content consumption to reputation building.

3.4 The Connection Between the Trust Triangle and Consumption Scenarios

By combining these three dimensions, we can see a path that seamlessly connects with consumers through encryption.

A user aggregated their on-chain identity on Web3.bio and passed real-person verification. They were also a highly active member of a music club on Orb and had multiple publicly verifiable and accurate prediction records on Firefly. When they entered a Blackbird partner restaurant, the terminal scanned their wallet address, and the backend confirmed their verified identity and social reputation. The system identified them as a high-value diner and automatically allocated 5x $FLY rewards. At checkout, they paid with Ether.fi Cash, with the amount deducted from their staking earnings. After the meal, they posted their experience on Firefly and synchronized it across multiple platforms. The content was minted into NFTs and collected and rewarded by the Orb community.

In this process, consumer credit is no longer held solely by a single platform, but rather derived from user behavior accumulated across multiple decentralized applications, making it portable and combinable. Merchants also save the cost of repeatedly purchasing traffic from centralized platforms, as the profile of "high-value consumers" is directly aggregated through multiple on-chain signals.

3.5 Can this resolve the bottleneck in KYC?

Looking back, the typical pain point for encrypted card users is not just having to submit documents once, but that every time they change cards or use a new payment application, they have to start all over again, repeatedly submitting passports and proof of address, which is both inefficient and exposes their privacy. The above model offers another possibility.

If card issuers can accept "credential-based" verification—where users present proof of successful liveness detection coupled with a certain level of social credibility—instead of requiring users to submit raw identity documents every time, the friction in KYC would decrease by an order of magnitude. Currently, Web3.bio has integrated KYC information from compliant trading platforms like Binance and Coinbase and is exploring liveness detection solutions based on NFC passport scanning and biometrics with Sign. Platforms like Polygon ID and zkPass are also exploring similar directions, while the integration of Polymarket and Snapshot on Firefly can fill the gap in credibility assurance. A user with stronger on-chain judgment and higher community status often has a higher risk score than an address with zero social history. These signals can serve as auxiliary inputs for risk control models, working in conjunction with traditional KYC for tiered processing.

Of course, this doesn't mean it can immediately replace legal identity verification. In strictly regulated scenarios, card issuers still need to complete due diligence, but on-chain identity and social reputation can serve as a supplementary dimension, reducing duplicate submissions and allowing for lighter verification in small-amount, low-risk consumption scenarios. In the long run, the issue isn't whether decentralized social platforms can immediately replace Web2 platforms, but whether they can provide a "user-controlled, selective disclosure, multi-scenario reuse" identity solution in a high-pressure KYC environment. This is closer to the initial internet vision of digital identity than repeatedly uploading passport copies.

IV. Outlook: When AI Starts Spending Money for You

The three components outline a gradually clearer chain: encrypted cards have opened up payment channels, consumer applications have reshaped high-frequency scenarios such as dining and ticketing, and decentralized social applications are attempting to provide a low-friction trust foundation for all of this. Together, these three elements are making it feasible for "on-chain assets to be spent like cash and consumption behavior to be carried like credit."

Looking further ahead, this architecture may not be solely designed for human consumers. Another technological line is accelerating alongside it.

4.1 When the payer is no longer a "person"

In 2026, a notable phenomenon is that AI agents are extending beyond their instrumental role to become independent initiators of payment transactions. Morph predicts that by 2027, AI agents will replace humans as the largest initiators of transactions on stablecoin blockchains. Currently, there are over 400,000 AI agents with autonomous purchasing capabilities operating globally, with the vast majority of transactions settled in USDC. They call APIs, lease computing resources, and pay small fees for specific tasks—with extremely high frequency and extremely small amounts. Traditional card organizations and banking networks were never designed with this scale of settlement needs in mind. Visa, in its forward-looking report , calls this trend "Agentic Commerce." As Coinbase's Jesse Pollak pointed out in an interview with CoinDesk, "Agents run in software, they need money, and they exist in software form," making crypto infrastructure the natural foundation for "Agentic Commerce."

However, the ensuing question is straightforward: how do you conduct KYC on an AI agent? Traditional "Know Your Customer" (KYC) relies on the premise that the customer is a natural person. This premise no longer holds true when the payment entity becomes a running smart contract or an autonomous agent. Therefore, in April 2026, MetaComp released the StableX KYA (Know Your Agent) framework at the Money20/20 Asia conference in Bangkok. It is believed to be the world's first governance framework for AI agents in regulated financial services, specifying how AI agents should be identified, authorized, monitored, and held accountable in scenarios such as payments, compliance, and wealth management. This means that the identity infrastructure discussed in Part III—on-chain liveness verification, cross-protocol identity aggregation, and decentralized social reputation—may become even more indispensable in the AI ​​era. The only difference is that the verification target has expanded from human consumers to on-chain entities performing various autonomous behaviors.

4.2 Re-intersection of the three-layer closed loop

Placing this variable into the framework mentioned earlier reveals that the three-layer structure of consumer encryption (payment, scenario, identity) has taken on new meaning in the AI ​​era.

Cryptocurrency cards and stablecoin payment channels provide the low-friction settlement layer needed by AI agents. Circle's Nanopayments solution, launched in March 2026, enables USDC transfers as low as $0.000001 with no gas fees through off-chain aggregation and batch on-chain settlement, specifically designed for small, high-frequency payments between agents. Stripe has also built a USDC payment infrastructure for AI agents based on the x402 protocol, allowing developers to charge agents a $0.01 API call fee per transaction. This means that agents can automate processes such as price comparison, booking, and payment, which is precisely what traditional bank APIs and card organization clearing systems struggle to support.

The on-chain consumption records and scenario data accumulated by consumer crypto applications will become crucial inputs for training and constraining AI agents: the agent needs to know who it represents, in what scenarios, and how much it can be authorized to spend. Decentralized identity and social reputation may evolve from "a KYC machine" to "a trust scoring engine"—the on-chain behavior of both humans and AI agents can be traced, evaluated, and graded. One possible scenario is that a user's AI agent is authorized to use a certain amount of stablecoins each month to book their favorite restaurants, purchase early bird tickets for specific music festivals, and sift through the secondary market for verifiable on-chain tickets while automatically filtering out counterfeit tickets. The underlying components required for these scenarios are no longer purely theoretical discussions but have already taken initial product form.

4.3 From Speculative Instrument to Medium of Value

Returning to the present, the most pressing issues for consumer crypto remain how people use it, how they trust it, and how it complies with regulations. Crypto card users are still stuck in the layers of KYC submissions; consumer applications are still convincing brands that on-chain points are not just a gimmick; on-chain identities are still in the early stages of integration and are far from large-scale mutual recognition. The arrival of AI-powered agent payments may accelerate the evolution of infrastructure, but it will not skip over these problems that are being solved—it will only make them more urgent.

From this perspective, the main theme this report attempts to clarify—how payment channels, consumption scenarios, and decentralized identities can work together—and whether KYC can be transformed from a point of friction into a trust service controlled by users—serving human consumers today and perhaps their AI agents tomorrow.

However, on a longer timescale, the industry has already crossed a watershed. From 2023 to 2026, what matters is no longer the rise and fall of market capitalization, but that cryptocurrencies have finally begun to connect with the real world's everyday necessities. When Haidilao (a famous hot pot restaurant chain) is paid for with a Bybit card, concert tickets are on-chain NFTs, restaurant points can be circulated across stores, and consumption records become portable credit, its role has quietly shifted from "asset trading" to "value medium." Although an imbalance in the token model can evaporate most of a project's market capitalization within two days, and the fragmentation of multi-chain liquidity still tests the abstraction capabilities of front-end applications, the path in the direction of payment, consumption, and identity coordination is no longer unclear.

Consumer crypto doesn't aim to create a parallel world accessible only to geeks. Instead, it seeks to lower transaction costs and facilitate trust in the real world through cryptographic rights confirmation, stablecoin liquidity, and disintermediation protocols. This effort begins with human consumers and will ultimately extend to AI agents authorized by them. Perhaps in retrospect, 2025-2026 will be the turning point when cryptocurrencies truly leave exchanges, enter ordinary people's wallets, and begin to integrate into daily life.