Internet payment processor Stripe has introduced a fiat-to-crypto on-ramp to address the "cold start issue" Web3 businesses are facing, as a result of customers not having "crypto in their wallets to transact." ".
According to a May 4 statementStripe's recently launched fiat-to-crypto onramp, to be hosted by Stripe itself, will allow Web3 companies to offer US-based customers code on a website or app.
Instead, customers will be directed to a link to convert their fiat currency into crypto.
Guillaume Poncin, head of crypto engineering at Stripe, said compliance-related tasks for Web3 companies using the onramp will be handled by Stripe, such as conversion optimization and authorization, identity verification, and fraud prevention. , in an effort to help "customers get started with Web3." services quickly and safely.
It was noted that integrated tools for fraud detection and identity verification have been implemented to help businesses meet their Know Your Customer (KYC) and compliance requirements.
We're introducing a Stripe-hosted fiat-to-crypto onramp (no code required) and unlocking the waitlist for the embeddable onramp. https://t.co/U9OW2cjFrZ pic.twitter.com/jjmkDUiOqc
- Raya (@raya) May 4, 2023
The implementation of the new onramp service aims to help Web3 companies provide an easy-to-use way for customers to top up their crypto wallets. He pointed:
"Businesses interested in offering cryptocurrency and blockchain-enabled experiences often face a cold start problem: their customers don't have the cryptocurrency in their wallets to transact."
Several Web3 companies, including privacy-focused browser Brave, decentralized finance (DeFi) protocol 1-inch, and blockchain protocol Lens Protocol, have implemented Stripe's fiat-to-crypto onramp, according to the report. release.
James Mudgett, vice president of Web3 products at Brave, said the service will allow the platform to "reach new Web3 users."
Meanwhile, Sergei Kunz, co-founder of 1inch, stressed the importance of building "bridges between Web2 and Web3," adding that Stripe's experience with Web3 companies makes it "well positioned to help."
Related: Crypto-Friendly Stripe Considers Public Offering: Report
Speaking to Cointelegraph, Ohm Shah, co-founder of Wallet Guard, stated that Stripe's new offering could "allow many people to easily get into Web3."
However, Shah stressed the importance of conducting due diligence before purchasing digital assets, even if the client is familiar with the company providing the on-ramp from fiat to crypto. He noticed:
โWhile using Stripe to buy your first NFT can be exciting, it's important to consider how easy it is to lose your assets, since all it takes is one malicious signature.โ
This comes after the mobile payment service. Venmo announced its own fiat-to-crypto payment service on April 28.
During an interview at Consensus 2023, PayPal executive Josรฉ Fernรกndez da Ponte said that the new feature would provide a use case for digital assets, because now cryptocurrencies will be used for "fast and free near-instantaneous transfers between the wallets of Venmo and PayPal wallets, which is basically connecting two of the largest networks and wallets in the country."
Meanwhile, a day earlier at Consensus, Robinhood announced its own onramp from fiat to crypto on April 27: Robinhood Connect, which allows users to buy and sell cryptocurrency directly with a credit or debit card, either in their self-custody wallet or natively in decentralized applications (DApps).
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