{
  "slug": "2026-11-01-kast-pays-8-to-12-on-stablecoin-reserves-while-the-backing-assets-earn-about-4",
  "title": "KAST offers 8% to 12% rewards while backing assets yield about 4%",
  "date": "2026-11-03T06:30:50.000Z",
  "updated": "2026-11-03T06:30:50.366Z",
  "tags": [
    "crypto",
    "finance"
  ],
  "source": "https://www.coindesk.com/business/2026/11/01/crypto-card-startups-are-racking-up-losses-just-to-buy-your-loyalty-with-big-rewards",
  "summary": "KAST pays higher rewards than its reserves earn while other crypto card issuers reduce cashback, putting customer acquisition costs in focus.",
  "kind": "article",
  "body": "# KAST offers 8% to 12% rewards while backing assets yield about 4%\n\n*KAST pays higher rewards than its reserves earn while other crypto card issuers reduce cashback, putting customer acquisition costs in focus.*\n\nKAST, a stablecoin platform that issues Visa cards, advertises 8% to 12% rewards on its Reserve account depending on membership tier, while the assets backing those balances earn 3.5% to 4%, [CoinDesk reported](https://www.coindesk.com/business/2026/11/01/crypto-card-startups-are-racking-up-losses-just-to-buy-your-loyalty-with-big-rewards) on November 1, 2026. KAST covers the difference.\n\n\"Previously we were nearly break even. Now we're loss-making,\" CEO Raagulan Pathy said. He described the gap as a customer-acquisition cost: \"You take a loss on acquiring the customer at the beginning, but then you sell them more and more features.\"\n\nKAST raised $80 million in March, led by QED Investors and Left Lane Capital. Pathy said the company has four to five years of runway.\n\nOther issuers are reducing rewards. Bleap, which issues a Mastercard card, moved from 2% cashback to a 1% base rate with higher category rewards. Eduards Timofejevs, CEO of Bleap Latvia, said customers who only spend and collect cashback can be unprofitable. Bybit EU replaced non-VIP cashback tiers of 2% to 10% with an uncapped 1%, effective August 4 for existing cardholders.\n\nKrak, Kraken's money app on the Mastercard network, is approaching 200,000 cardholders, who average about 8.3 card payments a week. Ether.fi's Cash card ties cashback, starting at 3%, to staking and DeFi vaults.\n\nCard fees cannot carry double-digit rewards on their own. European Union rules cap interchange at 0.2% on covered consumer debit transactions. In the United States, debit transactions exempt from the federal cap averaged 1.21% of purchase value in 2024, according to Federal Reserve data.",
  "sources": [
    "https://www.coindesk.com/business/2026/11/01/crypto-card-startups-are-racking-up-losses-just-to-buy-your-loyalty-with-big-rewards"
  ],
  "wordCount": 279,
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