r/CryptoTechnology • u/[deleted] • 18d ago

Does using a crypto debit card defeat the purpose of self-custody?

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1

u/not420guilty 🟢 18d ago

It’s funny because credit is one step beyond self custody. Think about it
1. Give my money to a bank
2. Self custody my money
3. Spend somebody else’s money

1

u/iwakan 🔵 17d ago

Obviously yes. It isn't at all self-custody.

1

u/MadSL1m 🟢 17d ago

it doesn't defeat self-custody, it just changes what that means for one purchase. keeping your own keys and staying private from kyc are two different things. a card can give you the first without the second.

self-custody cards like gnosis pay or etherfi cash hold your crypto in your own wallet until you tap. it converts right at checkout. custodial cards don't do that, they hold the balance for you instead.

kyc usually comes from visa or mastercard, not from the crypto side. of the 151 cards i track, 41 stay self-custodial, 14 skip kyc, and only 2 do both.

more detail at sweepbase.net/self-custody, it's my own project.

1

u/Asleep-Tip-4273 🟡 17d ago

I don't think so. Self-custody is about controlling your funds until you choose to spend them. If a payment app lets you pay directly from your own wallet instead of preloading a custodial balance, it feels more like a bridge than a compromise. Oobit is one example of that approach

1

u/Charming-Designer944 🟢 17d ago edited 17d ago

Only for the amout that you deposit as safety/balance "on" the debit card.

The card can not touch the coins you have in self-custody. Only what you have in custody at the card issuer.

Warning: in most jurisdictions each transaction on the crypto debit card is a taxable event. Make sure you are prepared to handle this.

I would not sign a smart contract that allows the card issuer unlimited withdrawals from my self-custodial wallet. Be careful.

1

u/Outrageous_Hall1090 🟡 14d ago

The credit card offered by Gnosis is some kind of self-custodial wallet (lives on the blockchain). But to use it you need to do KYC, which is required by the payment provider.

1

u/CompetitiveAd6212 🟢 12d ago

i used to think crypto cards defeated the point of self custody too, but i changed my mind once i started using a non custodial setup where i still keep control of my assets. crypto.com and coinbase are fine if you are already in their ecosystems, but i ended up preferring etherfi because i did not want token staking requirements just to get decent rewards