ZenGo, a mobile app to manage your cryptocurrencies, is about to launch a Visa debit card in the U.S. This isn’t the first crypto-powered debit card — Coinbase announced a U.S. expansion for its debit card just last week. But ZenGo is a non-custodial wallet, which means that you’re in control of your crypto assets.
When you leave your crypto assets on an exchange, somebody could log in to your account and send your assets to other wallets. Sure, there are some security features, such as email validation and two-factor authentication, but you’re essentially relying on the security team of your favorite exchange.
ZenGo and other non-custodial wallets put you in charge of security. You’re acting as your own crypto bank. It makes it more complicated to create a debit card as ZenGo can’t send and convert cryptocurrencies for you.
ZenGo is joining Visa’s Fintech Fast Track program with the intention to release its payment card in early 2021. While the card will initially launch in the U.S. only, the startup already plans to release it in other countries.
As ZenGo has no idea what cryptocurrencies you own, you’ll have to convert your crypto to USD first. In the mobile app, you’ll be able to convert some funds to fiat (such as USD) and deposit that amount on your card. If you plan to use your card regularly, you’ll be able to convert a fixed amount every week.
Compared to other crypto-powered cards, there’s an additional conversion step. “The issue if you do it automatically like Coinbase is that you can’t pick which crypto you want to use for spending. They decide for you or they force you to make a choice once for all your transactions,” ZenGo co-founder and CEO Ouriel Ohayon told me.
Additionally, anything that remains in your ZenGo wallet can’t be used with your card. Even if your card is compromised, your crypto assets remain safe.
ZenGo already lets you acquire cryptocurrencies in the app through partnerships with MoonPay and Coinmama. Thanks to the debit card, the startup will have both on-ramps and off-ramps with support for fiat-to-crypto and crypto-to-fiat conversions.