Debit cards offered through crypto payment service Wirex may stop functioning in the European Economic Area (EEA), according to a June 23 email the company sent to some of its customers. The threat of stoppage was triggered by Lithuania’s central bank revoking the license of UAB PayrNet, Wirex’s card provider.
This news comes after Wirex’s competitor, Cryptopay, also announced that its cards may stop working in the region due to the same issue.
Wirex is a multi-currency crypto payment app that features fiat on-ramps and off-ramps, as well as debit cards. It claimed in 2020 to have over 3 million users throughout Europe and Asia.
The email sent to customers stated that “our current card partner has experienced problems and this is causing an interruption in the debit card service for EEA customers.” This disruption “has no impact on your ability to access your funds through any other Wirex means, such as our IBAN service, or via transfer and purchase of cryptocurrency on the Wirex app.” Customers do not need to take any action as a result of this information since funds are held in the app and are unaffected by the card services issue.
Wirex stated that the cause of the problem was UAB PayrNet, not any issues within Wirex’s system.
On June 22, the Bank of Lithuania announced it was revoking UAB PayrNet’s electronic money institution license “for serious, systematic and multiple violations of legal acts.” Among other accusations, the central bank claimed that PayrNet failed to properly administer Anti-Money Laundering provisions to prevent its services from being used for illicit financing.
In its announcement, the Bank of Lithuania claimed that client funds are safe, saying that they are “safeguarded in separate dedicated accounts.”
Cointelegraph has attempted to contact UAB PayrNet through email but did not receive a response by the time of publication. PayrNet’s director, Stephenas Couttie, reportedly claimed that the central bank’s actions are “not adequate for the violations committed,” according to a Google translation of text from Lithuanian news site Verslo Žinios. This seems to imply that the director feels PayrNet is undergoing excessive punishment, disproportionate to the violations committed.
In its email to customers, Wirex said it is switching to Transact Payments Malta Limited to handle its debit card services. This plan was already in the works but is being accelerated due to the current problems. It is “working hard” with both PayrNet and Transact to get its debit card system up and running again as soon as possible.
In the meantime, customers in the EEA region may not be able to use their cards.
Wirex has been expanding its service offerings over the past two years. In August 2022, it partnered with 1inch to provide wallet-based token swaps to its customers. In February 2022, it integrated with the Avalanche (AVAX) network, allowing users to deposit AVAX and spend it through a debit card.
Sourced from cointelegraph.com.
Written by Tom Blackstone on 2023-06-26 20:32:48.