What Happens When You Tap a Crypto Card, Step by Step
When you tap a crypto card, the terminal sends an ordinary card authorization -- a token stands in for your card number, the merchant's bank passes the request to Visa or Mastercard, and the card issuer's side approves or declines it against the money available on the card. On a prepaid, load-then-spend card like SolCard, no crypto moves at that moment: your crypto was already converted into a US dollar balance when you topped up, so the tap spends dollars. The merchant's final amount is confirmed later in clearing, and the banks square up in settlement, which Visa says happens "usually within 24 to 72 hours," per Visa.
The "beep" feels like the end of the payment. It is closer to the start. Here is what actually happens in the seconds after you tap, and in the days after that -- and where a crypto card differs from a bank debit card, which is less than most people expect.
Card payments run in three stages. Only the first happens while you stand at the counter.
| Step | Who acts | What moves | When |
|---|---|---|---|
| 1. Tap or online entry | You, your phone or card, the terminal or checkout | A payment token or card credentials, not money | At the counter |
| 2. Authorization request | Merchant, acquirer (merchant's bank), network | A message asking "can this card pay this amount?" | Seconds |
| 3. Approve or decline | Issuer or its processor | A yes or no, plus a hold on available funds if yes | Seconds |
| 4. Authorization hold | Issuer | Nothing leaves your account; available funds shrink | Until the final amount arrives or the hold is reversed |
| 5. Clearing and capture | Merchant, acquirer, network, issuer | Final transaction details, which may differ from the hold | Later, typically in batches |
| 6. Settlement | Issuer, network, acquirer | Actual money, netted between banks | "Usually within 24 to 72 hours" per Visa |
| 7. Refunds and reversals | Merchant, acquirer, issuer | A reversal releases a hold; a refund is a new credit | Whenever the merchant sends it |
The rest of this guide walks through each row.
When you pay with a phone or watch wallet, the terminal usually never sees your real card number. EMVCo, the body that manages the EMV chip and contactless specifications, describes payment tokenisation as "removing the most valuable data to a fraudster, the primary account number (PAN), and replacing it with a unique alternative value, the EMV Payment Token." That token "is constrained in how it can be used. For example, to a specific merchant, device or payment scenario."
On the Visa side, this is the Visa Token Service, which works "by substituting Visa card numbers with tokens" and sits behind wallets including Apple Pay and Google Pay. For how that works with a crypto card specifically, see our guide to using Apple Pay with a crypto card. On SolCard, Apple Pay and Google Pay are available on the Platinum card, not on the virtual card.
Online, you type or autofill the card number, expiry, and security code instead. Virtual cards live mostly in this lane -- see spending crypto with virtual cards. Either way, what leaves your device is card credentials. Not crypto, not a wallet signature, not a blockchain transaction.
The merchant's terminal or payment page hands the transaction to its acquirer, the merchant's bank or payment processor. Visa describes the acquirer as the party "that reimburses the merchant" -- and the issuer, "the account holder's bank," as the one that later "reimburses the acquirer," per Visa.
The acquirer sends an authorization request over the card network. Visa's developer glossary puts it this way: "Once a cardholder initiates a purchase, VisaNet informs the issuer of the transaction, and receives back their approval or decline response," then passes that response back toward the merchant, per Visa Developer. The network routes the message and applies its rules; it does not hold your money.
On the other end of the network is the issuer -- the institution behind your card -- or a processor acting for it. It checks the request: is the card valid and active, do the security data look right, and are there enough funds available for this amount. Then it sends back an approval or a decline, and the terminal shows the result.
On a bank debit card, "available funds" is your checking balance. On a prepaid card, it is the balance loaded onto the card. For a crypto card, what "available funds" means depends on how the card is built -- which is where the two designs part ways.
This is the part most "how crypto cards work" explainers blur, and it changes what the tap actually does. Crypto cards are generally built one of two ways.
Convert at load (prepaid, load-then-spend). You send crypto to top up the card. The crypto is converted, and the card is credited with a fiat balance. From then on, the card behaves like any prepaid card: every tap is authorized against that fiat balance. Nothing is sold at the register.
Convert at tap (spend-from-wallet). The card is linked to a crypto balance held by the provider. When an authorization request arrives, the provider decides in real time whether your crypto covers the purchase and converts the needed amount, usually as part of approving the transaction. The crypto sale and the card payment are bundled into the same few seconds.
| Convert at load (prepaid) | Convert at tap (spend-from-wallet) | |
|---|---|---|
| When crypto becomes fiat | When you top up | During each purchase |
| What the authorization checks | A fiat card balance | Whether a crypto balance covers the amount |
| Rate you get | The conversion at top-up | The rate at the moment of purchase |
| What you see before paying | A known dollar balance | A crypto balance whose dollar value moves |
| What a refund returns | Fiat to the card balance | Depends on the provider's design |
| Each purchase is also a crypto sale | No | Typically yes, depending on the provider |
Either way, the network, the acquirer, and the merchant see a normal card transaction. The difference lives inside the issuer side of Step 3 and in what happened before it.
SolCard is convert-at-load. When a top-up is processed, the system computes a US dollar amount for the deposit and sends a deposit in that dollar amount to the card provider, which holds the card balance. Card authorizations are handled by the provider against that already-loaded balance, and when our system later records a card transaction, it books a dollar spend or a dollar refund against the card. No code path sells crypto when you tap. In practice, that means the number you see before you pay is already dollars, and the tap is just a card payment. For the broader category, see what is a crypto debit card.
An approval does not move money. It reserves it. Visa's merchant guidance puts it plainly: "With each successful authorization, the issuer typically reduces the amount available to the cardholder for other purchases to cover the approved transaction - this is commonly known as an authorization hold," per Visa.
The hold is not always the final price. Some merchants don't know the total when you start:
- Hotels, fuel pumps, and car rentals. Visa says businesses such as "a hotel, gas station, or car rental" may place "a temporary hold on some money," which "isn't a charge," and is "released once the actual payment amount is processed, but it may take a few days for the money to become available again," per Visa.
- Estimated and incremental authorizations. A merchant may authorize a genuine estimate, add incremental authorizations if you spend more, and "must reduce the authorized amount using a partial authorization reversal" if the estimate exceeds the final amount, per Visa.
- Restaurant tips. Visa notes that "the most common practice in the U.S. is to add a tip or gratuity after the authorization has occurred," with the tip adjusted in settlement, per Visa.
The practical point: the amount you see pending right after you pay can be higher or lower than what finally posts. A hold can be released, reduced, or settled for a different amount.
After the sale, the merchant "captures" the transaction -- submits the final amount, often in an end-of-day batch -- and the acquirer sends it into clearing. Visa's developer glossary describes clearing as "the process by which validation, financial assessment and actual movement of the Transaction is performed," per Visa Developer.
Clearing is where the hold turns into a posted transaction. If a restaurant added a tip, or a fuel pump finished at a lower amount than the hold, the cleared figure is the one that counts. This step happens later than the tap, and its exact timing depends on the merchant and processor.
Settlement is when money actually moves. Visa's glossary says its purpose is "to calculate and report the net financial positions of the parties to the Transaction, and facilitate the movement of the funds between them," per Visa Developer. Visa says the issuer reimburses the acquirer "usually within 24 to 72 hours," per Visa.
You never see this step, and on a prepaid crypto card it does not involve your crypto at all -- it is a bank-to-bank process between institutions. Some networks now let those institutions settle in stablecoins; we covered that separately in how Visa and Mastercard settle in stablecoins.
People use "refund" for two different things, and they behave differently.
- Authorization reversal. If a sale is cancelled before it completes, the merchant sends a reversal telling the issuer "that the hold on cardholder funds should be removed." Visa's merchant guidance says an uncompleted transaction's full authorized amount "must be reversed within 24 hours of when the merchant becomes aware that that transaction would not be completed," per Visa.
- Refund. If the sale already went through, a return creates a new credit transaction. Visa tells merchants to "process the refund to the account number used in the original purchase" and to let the cardholder know "it may take a few days for the credit to appear," per Visa. The US Consumer Financial Protection Bureau makes the same point for prepaid cards: "If you cancel a purchase, it could take some time to process and for the money to be returned to your card," per the CFPB.
On a convert-at-load card, a refund comes back the way the purchase went out: as fiat. SolCard's backend records merchant refunds as a dollar credit to the card, not as crypto sent back to a wallet. If the crypto market moved between your top-up and the refund, the refund doesn't carry that movement. It is credited in dollars for what the merchant refunds, and on a foreign-currency purchase exchange rates can make it differ slightly from the original charge.
If you pay a merchant in euros, yen, or pounds with a dollar-denominated card, the transaction still flows through the same seven steps, with a currency conversion added along the way. There are two places that conversion can happen:
- The network and issuer convert. You pay in the local currency and the conversion is applied on the card side, plus any foreign transaction fee your card program charges. On SolCard, the fee can differ between the virtual and Platinum cards.
- The merchant converts (Dynamic Currency Conversion). A terminal or checkout may offer to charge you in your home currency. Visa says that option "includes an exchange rate and additional fees," that "the choice is yours in deciding to accept or decline," and that merchants must display any "additional fees or markup assessed," per Visa.
On a convert-at-load card, any conversion at this step is fiat to fiat only; your crypto was converted once, at top-up.
It depends on the card's design. On a convert-at-tap card, the provider typically converts crypto during the purchase. On a prepaid, convert-at-load card like SolCard, the conversion happens when you top up, and the tap spends an existing US dollar balance, so nothing is sold at the register.
The pending amount is an authorization hold, which can be an estimate. Hotels, fuel pumps, and car rentals often hold an estimated amount, and US restaurants commonly add the tip after authorization. The merchant's cleared amount replaces the hold, and Visa requires merchants to reverse any excess, per Visa.
Authorization takes seconds. Clearing follows later, usually in merchant batches, and Visa says the issuer reimburses the acquirer "usually within 24 to 72 hours," per Visa. None of that timing changes what you see at the terminal.
A cancelled sale is usually handled with an authorization reversal that releases the hold. A completed sale is refunded with a new credit transaction to the same card, which can take a few days to appear, per Visa. On SolCard, refunds are credited to the card in dollars.
A tap starts a card transaction, not a crypto transaction: a token, an authorization, a hold, then clearing and settlement later, with refunds as separate credits. The one step where crypto cards genuinely differ is when your crypto becomes fiat: at the moment of purchase, or, on a prepaid card like SolCard, back when you loaded it.
If you want a card where the balance you spend is already dollars before you tap, you can see how SolCard works.
- Visa -- How a Visa transaction works
- Visa -- Estimated and Incremental Authorization and Reversal Processing Requirements for Visa Merchants (2024)
- Visa -- Visa Debit cards
- Visa -- Chip Payment Acceptance for Restaurant Merchants (2018)
- Visa -- Processing Refunds to Cardholders in a Merchant Store Location (2016)
- Visa -- Dynamic Currency Conversion
- Visa -- Visa Token Service
- Visa Developer -- Glossary
- EMVCo -- EMV Payment Tokenisation
- Consumer Financial Protection Bureau -- Cancelled purchase still showing on a prepaid card
