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By the way I just noticed that if I use the in-app Safari on other apps, like Twitter or Telegram, the translation works. So it's there but it's not available form the regular safari because some reason.
How did you use the in-app safari on other app?

do you mean using safari to browser the web interface of Twitter and telegram?
 
How did you use the in-app safari on other app?

do you mean using safari to browser the web interface of Twitter and telegram?
if you have the twitter or telegram app and you click on a link there where it will open?? on the safari app or in the same app on the in-app browser?

I was able to enable the translation through this in-app browser.
 
I've recently upgraded to an M1 MBP (Big Sur) from an 11" MacBook Air (Catalina). The translate button is missing from the Big Sur install but available for the Catalina. Super weird.
 
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