[Perspective] Why Can’t Credit Card Points Be Redeemed Immediately? The Challenges of Synchronizing “Information” and “Value,” and How Stablecoin Technology Can Address Three Major Issues.

Why Can’t Credit Card Points Be Immediately Used for Reductions?

Recently, a piece of news related to the “2025 deadline” emerged. A few years ago, UNESCO called attention to the fact that video tapes would gradually demagnetize over time, and 2025 would mark the “final deadline” for such magnetic media. UNESCO urged people who still have video tapes at home to digitize their files early to preserve valuable memories and data.

The experience of going to a video store to pick a movie, or even having to “rewind” to rewatch a specific scene, has long become a thing of the past for modern people, who are used to streaming services. This is a relic of a bygone era.

The evolution of financial products follows a similar path.

For Gen Z and Alpha generations, who have grown up with computers, the internet, and smartphones, the first investment or trading assets they come into contact with are probably not real estate, stocks, mutual funds, or bonds. Instead, they might be cryptocurrencies such as Bitcoin, Ethereum, or even meme coins.

Cryptocurrencies operate on blockchain technology, featuring traits such as “24-hour trading,” “global accessibility,” and “real-time settlement.” As such, these digital-native generations have an inherent expectation that financial services should incorporate these features.

As this group accumulates more investment experience and begins using traditional financial services and asset allocation, they may start asking many questions of “why.”

Recently, while recording the podcast “Web3 Big Westward Journey” with reporter Lisa Lin, who focuses on financial trends and blockchain development, she, under 30, raised a question: “Why can’t credit card points accumulated through spending be immediately used to offset expenses?”

This might be something many people haven’t seriously thought about, even though it’s become a habit. However, for Lisa’s generation of young people, it’s a strange issue, because in her familiar world, from the internet to blockchain, this should be possible.

Difficulty in Syncing Information and Value! Three Major Challenges in the Points System

Bank credit cards generally come with a reward system tailored to different products and attributes. The rewards might include cash back to offset the next month’s bill, or points that can be redeemed for products or services.

However, due to the complex payment process involving the issuing bank, clearinghouse, acquiring bank, and merchants, it often takes several days for a transaction to be confirmed and the rewards to be calculated, making it difficult to receive and use the rewards immediately.

Currently, most credit card points systems face three common challenges:

• First, there is no way to immediately redeem the rewards at the time of purchase;
• Second, it’s difficult to transfer or exchange points between different systems;
• Third, it’s hard for the average person to understand the actual value of each point and whether it is backed by real value reserves.

This is because every credit card point system functions like a private ledger with unique mechanisms. For example, if you wanted to exchange one point from KGI Bank for one point from Far Eastern Bank, the value of each point may differ. Therefore, for point exchanges between the two banks to work, real-time settlement is necessary, which requires a massive infrastructure.

This is why most credit card points systems on the market cannot overcome these three challenges, making it difficult to synchronize “information” and “value” in real-time.

Common Standards and Common Ledgers: What Are the Benefits of Stablecoin Settlement Logic?

The example of credit card points redemption reminded me of the application of stablecoins on decentralized ledgers, which enable automatic and real-time settlement.

The operating mechanism of cryptocurrencies is based on a “consensus mechanism” in the blockchain. When a transaction is initiated, miners responsible for validating the transaction on the blockchain form a consensus within 10 to 20 minutes. If the majority of miners agree, the transaction is recorded on the blockchain, achieving real-time and synchronized transmission of “information” and “value,” with high stability and accuracy. This process is essentially one settlement.

In contrast, after a credit cardholder makes a purchase, the transaction undergoes five major steps before completion:

• The cardholder makes a purchase at the merchant;
• The merchant sends the transaction authorization to the acquiring bank and clearinghouse (e.g., Visa);
• The merchant confirms the transaction amount with the cardholder;
• The clearinghouse completes the settlement between the acquiring bank and the issuing bank;
• After completing the transaction authorization and settlement, the issuing bank sends a bill to the cardholder on the closing date.

The credit card transaction process involves multiple parties and may take several days to complete because different banks and systems have different specifications and ledgers.

This comparison highlights the advantages of blockchain’s decentralized ledger system, which operates with common standards and shared ledgers.

New Taiwan Dollar Stablecoin as Reserves! How Can Points Be Played in the Web3 Era?

This is why the issuance of the “New Taiwan Dollar Stablecoin” in Taiwan is so significant. Earlier this year (2025), the Financial Supervisory Commission held a public hearing to discuss the draft of the “Virtual Asset Platform and Trading Business Act” (VASP). One of the most anticipated aspects is the potential for banks to issue stablecoins pegged to the New Taiwan Dollar or US Dollar, providing a stable bridge for cryptocurrency transactions.

If banks are able to issue New Taiwan Dollar stablecoins, credit card points issued by banks in the future could be backed by stablecoins to ensure their value, with smart contracts enabling point issuance.

This approach has two major benefits. First, it ensures transparency in the reserves backing each bank’s points, confirming their value. Second, through smart contracts, the rules for point exchanges can be written into the system, automating exchanges between different bank point systems.

By using New Taiwan Dollar stablecoins as reserves and issuing brand points through smart contracts, points can become modular, enabling banks to design various marketing strategies based on their business models.

For instance, if 100 points from Bank A can be used to offset 10 NTD of expenses, and 1 point from Bank A can be exchanged for 5 points from Bank C, these rules can be written into a smart contract. When a user wishes to redeem points, the exchange will be automatically executed in real-time. This process is transparent and opens the door to linking with traditional financial systems and fiat currencies.

From credit card point redemption to everyday applications like this, we can see the advantages of stablecoins as settlement and clearing tools. They enable a more immediate, borderless, and transparent financial experience. In the Web3 era of new finance, this ensures the synchronization of “information” and “value,” presenting an irreversible trend in the financial experience brought about by blockchain technology, which has become an inherent demand for financial habits and expectations among the younger generation.