Visa says it will partner with cryptocurrency companies and allow consumers to pay in digital currency wherever its cards are accepted — nearly 70 million places worldwide. And merchants won’t have to do anything on their end, but rather, customers will simply pay in crypto using a Visa card and it will automatically convert to fiat currency.
"The merchants don't have to change anything," said Cuy Sheffield, Visa's head of cryptocurrency, speaking to Insider. "It will be the same as any other Visa transaction to them. But on the backend, the crypto assets are instantly converted into fiat."
Crypto cards — There already exists a rising market of crypto-linked Visa cards that let customers spend directly from their crypto wallets, and Visa says more than $1 billion was spent on such cards in the first half of 2021 alone.
With this new announcement, it should become easier for customers of platforms like Coinbase to link their wallets to a Visa card... assuming of course they aren’t HODLing.
Spending crypto — With the steep climb in the value of many cryptocurrencies in recent years, spending them to buy a pizza seems like a bad idea. But, at the same time, the ability to more easily transact could provide a much-needed adoption boost, and use cases beyond the speculative investments that bitcoin, in particular, is primarily used for today. Cryptocurrencies offer unique benefits over fiat currency, like the ability to move funds around much faster.
Having a name like Visa attached could foster wider acceptance of digital currencies and bolster trust in them. If you can spend ethereum anywhere, for instance, using a debit card — rather than withdrawing it from a wallet and waiting for it to post in your conventional, fiat-backed bank account — it starts to feel like legal tender like any other, and less like some newfangled thing with lots of complexity and friction.
Do watch out for the capital gains taxes if your holdings have increased in value since you bought them, though. Nonetheless, greater liquidity and ease of use make cryptocurrencies inherently more useful.