Transak, the cryptocurrency payments firm, has announced a strategic partnership with Visa, the global finance multinational, to facilitate the seamless conversion of cryptocurrency tokens into local fiat currencies in a statement released on January 30, 2024. The arrangement will see Transak join the Visa Direct program, enabling users to convert their crypto balances into fiat for withdrawal or spending at the over 130 million merchants that accept Visa globally.
Explaining the reasoning behind the partnership, Transak argued that the bridge to convert crypto to fiat does not exist for most people, leaving them stuck, seeking alternate exit methods that may not be compliant with local regulations. “Many consumers need a fast, secure, and compliant way to exit the crypto market — a fitting tribute to the liquid nature of cryptocurrencies,” the statement said, proposing its partnership with Visa Direct as an easier way to convert crypto to fiat.
How Transak’s Crypto-to-Fiat Conversions Should Work
While Transak claims its partnership with Visa will enable (easier) crypto-to-fiat conversions, it hasn’t disclosed detailed implementation plans. But, its January 30 announcement leaves enough clues for an accurate guess of how the new partnership should benefit users.
In the announcement, Transak praised the ability of Visa Direct to process transactions in real-time, allowing for money transfers within 30 minutes, while bringing attention to its robust infrastructure with support for over 40 cryptocurrencies. It seems like Transak is planning to guarantee fiat for users looking to exchange their crypto holdings for fiat, but only for around 40 cryptocurrencies. Eligible users should be able to convert their cryptocurrencies directly from their self-custodial wallets like MetaMask, according to Transak’s current proposal.
In the coming weeks, we should see Transak implement features that enable users to exchange their cryptocurrencies to their local currency for a tiny fee. The exchange should work across 40 supported cryptocurrencies. We (also) expect the conversions to be relatively quick, taking around 30 minutes or less.
Transak-The Partnership is a Huge Win for Crypto
The Transak announcement described the collaboration of Transak and Visa Direct as an essential step in the maturation and eventual mainstreaming of virtual currencies like crypto.
“This collaboration is about bridging a gap that has long been a bottleneck in the crypto world: Converting cryptocurrency holdings into a local fiat currency quickly,” Transak wrote, making a case for the integration of web2 and web3 payment giants to make crypto to fiat conversions easier for cryptocurrency enthusiasts.
Stakeholders Hail the Development as Revolutionary
The development has attracted widespread praise from observers and stakeholders in the industry, with many praising the initiative for addressing a significant pain point for players in the industry. While commenting on the partnership, MetaMask senior product manager Lorenzo Santos hailed the extra functionality that results from the new Transak-Visa partnership.
“Transak’s integration with Visa opens new horizons for MetaMask users globally, providing more flexibility in smooth cryptocurrency to fiat conversions,” Lorenzo said while reacting to the new development. Thanks to the partnership, crypto off-ramps to fiat currencies through Visa are now possible on MetaMask, opening up new possibilities for the cryptocurrency wallet.
Visa Continues Bullish Crypto Moves, Enables Withdrawals in 145 Countries
The partnership with Transak is not the first attempt by Visa to venture into the crypto industry. In 2020, the global finance multinational partnered with Circle, the blockchain development firm behind the popular USDC stablecoin, to enable USDC stablecoin support for debit cards. The company also recently collaborated with Crypto.com to launch a Crypto.com Visa card with diverse functions.
In a page on Visa’s US website titled “Crypto – Money is evolving,” the global payments giant makes a case for cryptocurrencies in the payments sector, expressing readiness to become the payment network of choice for cryptocurrency transactions. Its latest collaboration with Transak is another strategic move to further its crypto vision. The latest crypto-to-fiat conversion feature will launch in 145 countries (for a start), thanks to a combination of Visa’s vast payment network and Transak’s plethora of crypto payment licenses.