But how do you upload crypto assets to these software wallets? The most logical use case is that you first sign up to a centralized crypto exchange like Coinbase or Kraken. Once you have verified your identity, you can buy cryptocurrencies and then transfer those assets to your non-custodial wallet.
In that case, MoonPay and Ramp take care of KYC requirements, fraud and compliance. They support dozens of fiat currencies and customers from more than 150 countries. Essentially, you create an account with MoonPay or Ramp when you want to buy crypto assets and top up your wallet — no exchange-to-wallet transfer required.
That’s a much smoother experience as you don’t have to jump between multiple products. Of course, convenience isn’t cheap. MoonPay charges 4.5% on card payments while Ramp charges 2.9%. They also both offer bank transfers for lower fees.
Stripe’s fiat-to-crypto onramp would work more or less similarly. It is currently only available to U.S. customers who are invited to test the product.
When a user wants to buy crypto, Stripe’s widget asks you how much you want to spend in your fiat currency — the company adds fees on top of that. You can then select the cryptocurrency you want and see how much you will receive once the trade is confirmed.
The payment company handles KYC, payments, fraud and compliance so that crypto companies can focus on crypto instead of competing with Stripe. There are also some side benefits with Stripe’s fiat-to-crypto onramp product.
After the FTX debacle, products like Ramp, MoonPay and Stripe’s fiat-to-crypto widget are going to be essential. They can make it easier to avoid centralized exchanges. And it’s good to see that there are multiple companies working on that issue.