Web3 businesses can use the fiat-to-crypto ramp hosted by Stripe to allow customers to buy crypto “at the exact moment they want it.”
Internet payments processor Stripe has launched a fiat-to-crypto on-ramp to address the “cold start problem” Web3 companies face when customers don’t have “cryptocurrency in their wallets to transact.”
Stripe’s new fiat-to-crypto onramp will allow Web3 to offer US customers the ability to buy cryptocurrencies “at the exact moment they want” without embedding any code into websites or apps, according to a statement from May 4th. .
Instead, customers will be directed to a link to convert their fiat currency to cryptocurrency.
Guillaume Poncin, Stripe’s director of cryptographic engineering, said Stripe will handle several compliance tasks for Web3 companies using portals, including conversion optimization and authorization, authentication and fraud prevention, to help “customers get started to use Web3 services quickly and safely”.
In particular, built-in fraud detection and identity verification tools have been implemented to support companies in meeting know-your-customer and compliance requirements.
The implementation of the new on-ramp service aims to support Web3 companies by providing customers with an easy-to-use way to load their crypto wallets. it’s said:
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“Companies interested in offering cryptocurrencies and blockchain-enabled experiences often face a cold-start problem: their customers don’t have cryptocurrencies in their wallets to transact.”
According to the statement, several Web3 companies, including the privacy-focused Brave browser, the 1inch decentralized financial protocol, and the Lens Protocol blockchain protocol, have already implemented Stripe’s fiat-to-crypto onramp.
James Mudgett, Brave’s vice president of Web3 products, said the service will allow the platform to “reach new Web3 users.”
Meanwhile, 1inch co-founder Sergey Kunz stressed the importance of “building a bridge between Web2 and Web3,” adding that Stripe’s experience with Web3 companies makes it “well-positioned to help.”
Related: Crypto-Friendly Stripe Weighs IPO: Report
Wallet Guard co-founder Ohm Shah told Cointelegraph that Stripe’s new product could “make Web3 easy for a lot of people.”
However, Shah stressed the importance of doing due diligence before buying digital assets, even if clients are familiar with companies that provide fiat-to-crypto onramps. He pointed out:
“While buying your first NFT [non-fungible token] through Stripe can be exciting, it’s important to consider how easy it is to lose your assets with just one malicious signature.”
This follows mobile payment service Venmo announcing its own fiat-to-crypto payment service on April 28.
In an interview at Consensus 2023, PayPal CEO Jose Fernandez da Ponte said the new feature will provide a use case for digital assets, as cryptocurrencies will now be used for “quick and free near-instant transfers between Venmo wallets and wallets PayPal”. Transfer money, which basically connects the two largest networks and wallets in the country.”
Meanwhile, Robinhood announced its fiat-to-crypto on-ramp at Consensus on April 27. Robinhood Connect allows users to natively buy and sell cryptocurrencies in their self-service wallets or decentralized applications using credit or debit cards.
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