Inside Colossus's Mission to Swap Out Visa and Mastercard for Crypto Cards Without KYC

Inside Joseph Delong’s Crypto-Powered Card Venture

Joseph Delong’s workspace today resembles an electronics workshop more than a typical developer’s desk, scattered with devices that the crypto industry once aimed to make obsolete.

This shift is due to Delong’s latest project: building Colossus, a stablecoin-based credit card network. As a seasoned Ethereum developer and former CTO of SushiSwap, Delong has amassed a collection of hardware—from test point-of-sale machines to card readers and manufacturer sample kits—while developing the platform.

“Getting access to the necessary hardware feels like uncovering secret knowledge,” Delong shared in an interview from his home office in San Antonio, Texas.

Colossus operates with a small team of four and plans to launch its Ethereum layer-2 scaling network in March. The system is designed to bypass traditional banking settlements, instead using a proprietary credit card infrastructure where users’ account addresses serve as their only identity.

According to documents provided to Decrypt, Colossus has secured $500,000 in pre-seed investment, giving the startup a $10 million valuation.

Delong envisions a future where users can “destroy their cards from home,” but acknowledges that creating a crypto payment solution independent of giants like Mastercard and Visa is a complex challenge, with potential obstacles yet to be revealed.

One major hurdle is disrupting the established relationships among businesses that facilitate settlements for legacy card networks—systems not built on the cypherpunk ideals that Delong wants to embed in Colossus.

“Many of these institutions don’t see an issue because they’ve built strong trust over time,” Delong explained. “They can settle transactions between banks based on promises or minimal collateral.”

In the conventional card payment process, the issuing bank acts as the main gatekeeper, approving transactions after verifying customer balances and identities according to KYC and AML standards.

This process involves a chain of intermediaries: member associations like Mastercard and Visa set the rules, processors manage technical communications, and acquirers such as Worldpay and Fiserv handle merchant relationships.

Colossus aims to streamline this entire system by combining the roles of issuer, processor, and settlement network. Instead of banks authorizing deposit movements, Colossus’s layer-2 network uses cryptographic signatures to instantly transfer stablecoins, potentially lowering transaction fees.

How Colossus Bridges Crypto and Traditional Finance

While Colossus simplifies much of the payment stack, it maintains the acquirer’s role for merchants, ensuring compatibility with millions of existing point-of-sale terminals. Acquirers serve as a bridge, converting on-chain stablecoin payments into traditional wire transfers that businesses use for expenses.

“I’m not sure why so many in crypto think merchants want stablecoins,” Delong remarked. “Most just want something they can use to pay their suppliers.”

Not Your Keys, Not Your Card

Although stablecoins may not be immediately practical for merchants, Colossus is taking a unique approach by collecting minimal customer data.

Interpreting last year’s federal stablecoin regulations, Colossus believes the GENIUS Act does not require it to follow the same compliance protocols as traditional issuers, such as gathering personal information or obtaining money transmitter licenses in every state.

Delong noted that the network’s sequencer—which organizes and batches transactions before sending them to Ethereum—may include features to comply with U.S. Treasury Department OFAC sanctions.

This would mean filtering transactions through a centralized checkpoint, without embedding banking regulations directly into Colossus’s codebase.

Several startups have previously attempted to launch crypto cards without KYC requirements, but those dependent on established payment networks have struggled to sustain operations. For example, UnCash, which recently shut down, blamed Mastercard for abruptly ending its card issuer relationships.

UnCash revealed that 90% of its cards operated on Mastercard’s network and reportedly exploited a loophole by issuing thousands of cards under a single business identity, according to Fintech Business Weekly.

Most crypto-linked cards are created through partnerships with Mastercard or Visa. While Delong is working to bypass these networks and issuers, he acknowledges that companies like Coinbase and Gemini have chosen a more straightforward path to quickly gain traction.

“Our approach may seem idealistic at first, but it offers long-term advantages,” Delong said. “Requiring KYC or AML for a credit card seems unnecessary to me.”

Despite these challenges, crypto-linked cards are gaining popularity. According to a report from Artemis, such cards processed $1.5 billion in stablecoin transactions last August—twice the volume from the previous year.

The report highlighted that companies in Latin America, EMEA, and Southeast Asia are using crypto cards to serve populations facing severe financial difficulties, such as inflation and capital controls.

In the U.S., some lawmakers have raised concerns that the GENIUS Act does not go far enough to address illicit finance risks. Delong sees Colossus as a way to make crypto transactions feel more like cash, enabling users to fully embrace on-chain living.

Delong’s drive to create Colossus is also personal. He stopped using bank accounts for savings years ago, but still converts stablecoins to fiat to pay his bills.

“I want to make a real difference,” he said. “I believe this is the final step toward true financial freedom.”