Companion Song: Don’t Think Twice, It’s Alright – Bob Dylan

Time for part 2 of churning and MS advice pulled from folk music. In part one, I posited that diversifying your lineup of plays and not overlooking opportunities with limited profit ceilings was both a good way to scale up, but also a way to hedge against shutdowns. This time, I’m going to talk more about what to do in the latter situation.

A limited profit ceiling generally means tight caps. That could be something like the Chase Freedom capping quarterly 5x at $1500, but that isn’t a good example for my thesis. That (extremely) tight cap is the reason a mainstream fee free card with valuable transfer partners has 5x categories in the first place. 

Other times, tight caps are instituted by a fintech or smaller bank that is at least peripherally aware of rewards arbitrage and wants to nip that in the bud. While those caps stop them from hemorrhaging bonus and/or interchange payouts, it doesn’t stop savvy customers from getting some level of value out of them.

Nobody ever gets shutdown by Chase for maxing the Freedom cap, for a couple of reasons. The first is that $300/year is peanuts. But the second is that I’d imagine there was some level of financial modeling performed down at 270 Park Ave that determined the caps placed on certain cards were within acceptable risk and they were ok with a certain percentage of advantage players maximizing the cap. 

You know who probably doesn’t have the ability to do this (besides Citi)? A lot of the platforms that fit the mold of a play I described in the first installment. They’ll have limits in place, but they aren’t quite as scientific as a big bank like Chase could do (and they may be a direct reaction to an uncapped launch). 

Chase might be fine paying out on $6k/yr of Freedom spend or $25k/yr of CIC spend, because it’s a beyond miniscule part of their P&L. For your average series B fintech, paying interchange fees or bonus points is a more important part of the overall equation.

As a result, it’s not super hard to get shutdown even when you are playing fully within the rules. I encourage everyone to be ok with this outcome – you aren’t a profitable customer by any stretch of the imagination, so why would they want to retain you? It’s not like you’re suddenly going to start carrying a bunch of debt or using their pointless debit for everyday purchases. 

Talking about it theoretically is nice, but I always find it easier to illustrate with a real-world, recent example. A relatively large group of the community got axed by a fintech in the last week or so, even though they had fairly strict limits. This fintech wasn’t actually special, but it was one of a few somewhat well-known cogs in a much more well-known loop. 

Since this is 2025, I sympathize with those that are upset about losing something easy. But I’ve seen way too much thought and time devoted to these shutdowns and what the next step is. For 99% of us, the profit ceiling was somewhere between $300-$420/mo. I’m not minimizing that amount, especially since the hourly return on the time it took was fantastic. But ultimately, it’s not the home run play that is going to buy that orange Evora. 

The whole reason I advocated for finding and understanding as many $300-$500/mo plays as you can in the previous post is to reduce your exposure to a play dying – and to be able to shrug and say “oh well” when it does, because you have eggs in other baskets. 

Losing this one is a mild bummer. But that’s really all the brainpower you need to spend on it – it’s not exactly surprising that a company doesn’t want a bunch of users that load money in with a payment method they lose money on, and get the money out in a way they also don’t earn on, regardless of if it was within their limits. Ironically, we were the exact opposite of the customer persona they’re targeting. 

Onwards and upwards, my friends.

Cảm ơn!