The crypto community continually seeks ways to bridge the gap between traditional finance and fiat currencies with decentralized finance (DeFi) tools. On-ramp crypto platforms are a primary way users can cross between these two financial ecosystems.
However, a new report from Cointelegraph Research and Onramper, a provider of cryptocurrency-based financial services, revealed that 50% of fiat-crypto transactions faileven after completing Know Your Customer.
In addition, due to difficulties in the transaction process, the abandonment of the transaction during the purchase flow can reach 90%.
The survey looked at nine of the largest fiat cryptocurrency on-ramps, including Coinify, MoonPay, Transak, and Wyre, among others.
Based on the data, the performance of various access paths differs widely, although one of the main factors includes the location of the user. Europe had the highest transaction success rates, while the lowest were found in Africa and South America.
Other factors that affected transactions on cryptocurrency onramps include payment methods, fiat used to convert to cryptocurrency, and available trading pairs. Bank transfers as a payment method proved superior in transaction success rates, achieving close to 100% success in two instances.
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Additionally, transaction value was an important indicator of success, with smaller transactions with a value between $0 and $26 achieving a 66% authorization rate, compared to transactions with values โโgreater than $5,000, which typically they have a clearance rate of 19%.
The research concluded that possible solutions to transaction authorization problems could be for token service providers to offer as wide a range of accesses as possible aggregated into a single interface. Another is dynamic transaction routing to give users the best option for their situations.
Recently at the World Economic Forum, Tether CTO Paolo Ardoino called out the platform's stablecoin, Tether (USDT), a path for Bitcoin (BTC).
The Hong Kong Monetary Authority also outlined its upcoming central bank retail digital currency as a possible on-ramp into the DeFi space.
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