Memecoin buys on Robinhood Wallet and Fomo coded as "digital media," sidestepping card-network crypto rules
Test purchases of memecoins made with credit cards on Robinhood Wallet and Fomo appeared on statements as "digital media" transactions rather than crypto, the tests showed. That coding allowed the buys to earn credit card rewards points. Card networks restrict crypto purchases on credit, and the "digital media" classification appears to have routed around those restrictions.
Key takeaways
- Test purchases of memecoins made with credit cards on Robinhood Wallet and Fomo appeared on statements as "digital media" transactions rather than crypto.
- The "digital media" coding allowed the memecoin buys to earn credit card rewards points.
- Card networks restrict or block credit card use for crypto purchases, and the "digital media" classification routed around those restrictions.
- Both Robinhood Wallet and Fomo returned the "digital media" merchant code when memecoins were bought with a credit card.
- The tests did not determine whether the coding originated with Robinhood Wallet, Fomo, or the payment processors and acquiring banks.
Test purchases of memecoins made with credit cards on Robinhood Wallet and Fomo appeared on statements as "digital media" transactions rather than crypto, the tests showed. That coding allowed the buys to earn credit card rewards points. Card networks restrict crypto purchases on credit, and the "digital media" classification appears to have routed around those restrictions.
Robinhood Wallet is the self-custody wallet product of Robinhood Markets. Fomo is a separate platform. Both returned the "digital media" merchant code when memecoins were bought with a credit card, according to the tests.
The classification matters. Card networks maintain rules that restrict or block credit card use for crypto purchases. A "digital media" code reaches card issuers as a digital transaction, not a crypto buy, and the network-level restrictions do not trigger. Points accrued on purchases that card network rules restrict.
The tests did not report whether the coding originated with Robinhood Wallet, Fomo, or the payment processors and acquiring banks behind each transaction.