Robinhood Wallet and Fomo Users Buy Meme Coins With Credit…

Users of Robinhood Wallet and social trading application Fomo have been able to purchase meme coins with credit cards without completing a separate know-your-customer verification process, prompting Chase to ask Visa to investigate how the transactions are being classified.The purchases are powered by crypto payments infrastructure company Crossmint through its Token Checkout product.Tests conducted by The Block found users could purchase tokens including dogwifhat, or WIF, through both applications using Visa and Mastercard credit cards connected to Apple Pay or Google Pay.The transactions were not processed under merchant categories normally associated with cryptocurrency purchases. Instead, card statements classified them under merchant category code 5815, or “Digital Goods Media,” a category generally associated with products including digital books, movies, music and other downloadable content.That distinction has significant consequences for how banks and card networks treat the purchases.

Digital-Media Classification Opens Unusual Crypto On-Ramp

Cryptocurrency transactions are generally subject to specific merchant-category and transaction-identification requirements imposed by payment networks. Those classifications can affect whether a bank approves the transaction, whether it is treated as a cash-like purchase and whether customers receive credit-card rewards.The Crossmint transactions tested by The Block behaved like ordinary purchases. Users could therefore receive conventional points or cashback rewards when buying meme coins. Chase said a tested Visa transaction was not identified to the bank as a cryptocurrency purchase and that it believes the merchant-category classification was incorrect.The bank consequently opened a case with Visa requesting an investigation. Robinhood's own credit-card terms illustrate why the distinction matters. Its terms classify cryptocurrency purchases as cash advances rather than ordinary eligible purchases. Cash-like transactions generally do not qualify for the card's standard rewards program.Crossmint has defended its approach. The company argues that meme coins can appropriately be treated as digital collectibles, pointing to U.S. Securities and Exchange Commission guidance describing typical meme coins as comparable to collectibles whose value is primarily driven by speculation and market demand.The SEC's Division of Corporation Finance said in 2025 that transactions involving meme coins matching its description generally do not constitute securities transactions. However, securities classification and payment-network merchant rules are separate regulatory questions.

New York Attorney General Reviews Payment Structure

The issue has already attracted scrutiny beyond Chase and Visa. The New York State Attorney General's office told The Block that it was aware of the payment structure and was reviewing the matter. Robinhood and Fomo referred detailed questions about the transaction processing to Crossmint.The controversy is particularly notable because Robinhood's self-custody wallet is distinct from its regulated brokerage platform. Purchasing cryptocurrency through a conventional centralized exchange generally requires users to establish an account and complete identity verification before funding it with fiat currency.A self-custody wallet can instead interact with third-party payment infrastructure, allowing an external provider to handle the conversion between card payments and blockchain assets. Crossmint's checkout system effectively bridges those two environments.The result is a consumer experience resembling an ordinary online purchase: select a token, pay through Apple Pay or Google Pay and receive the asset directly into a wallet. But that simplicity creates compliance questions when the underlying item being purchased is a transferable crypto token rather than conventional digital media.Crossmint's reliance on the SEC's meme-coin statement adds another unusual dimension. The SEC explicitly said qualifying meme coins generally resemble collectibles and are not securities, but it did not say they cease being crypto assets for every other regulatory or commercial purpose.Visa and Mastercard operate their own payment-network rules, while banks separately determine how transactions are authorized and rewarded. That means the dispute is ultimately less about whether WIF constitutes a security than whether purchasing it should be processed as digital media or as a cryptocurrency transaction. Visa's review could therefore have implications beyond Robinhood Wallet and Fomo.If card networks determine meme-coin purchases must carry conventional crypto transaction classifications, providers using similar checkout structures could face stricter processing requirements, reduced rewards eligibility and potentially additional identity-verification obligations.For now, the purchases demonstrate how embedded crypto infrastructure can make acquiring blockchain assets nearly indistinguishable from buying conventional digital goods — while exposing gaps between securities regulation, payment-network rules and crypto compliance systems.