Crypto on & off ramps are a user-friendly gateway to crypto & web3
Blog Summary
- A crypto ramp is a payment plugin solution (or, widget) integrated into blockchain sites and decentralized applications (web3 dApps)
- It enables you to buy crypto very simply with your traditional fiat currency funds and vice versa
- Credit and debit cards, bank transfers, and mobile wallets are accepted
- Purchased crypto is sent to your own crypto wallet where you have control
When we first become interested in crypto, an early thing to figure out is how to purchase it. It is a surprisingly non-trivial task for a newcomer. The cumbersome process can also remain mildly irritating, even to experienced users.
Crypto on and off-ramps, like the ones Alchemy Pay provide, offer a solution that simplifies the process for both users and developers in the crypto and blockchain space. Here we explain what these ramps are and why they are key to the growth of crypto and web3.
The Problem
If you’re reading this, it’s fairly likely you’re more proficient with crypto than 99% of humankind.
You may have already figured out how to set up your first account with a crypto exchange. You’ve also learned out how to deposit your local fiat currency and exchange it for crypto on there. Maybe you’ve even understood about crypto wallets are and reassigned your crypto to one. Maybe you’ve even connected your wallet to a blockchain application and bought NFTs, generated yield on your crypto, or met friends in the metaverse.
Depending on your technical aptitude, the steps needed to purchase crypto can be a big or small barrier to entry. In fact, it remains a barrier that many people have failed to overcome.
In retail, they say if a customer’s first experience is a negative one, they are unlikely to return. Accessibility is a prerequisite for mainstream adoption. Crypto on/off ramps are a crucial part of the infrastructure needed for blockchain apps, web3 dApps, and crypto to thrive.
What is a Crypto On-Ramp?
First of all it’s key to note that the same payment plugin may have both ‘on’ and ‘off’ ramping functionality. In fact this is usually the case, although different platforms or payment providers offer different services.
An on-ramp is a direct-to-customer payment plugin solution (often called a widget) that allows users to buy crypto with government issued currencies (referred to as fiat currency).
In the case of Alchemy Pay’s ramps you can use credit and debit cards, bank transfers, and popular local mobile wallets. The customizable plugin is integrated into blockchain sites and decentralized applications (dApps).
Instead of having to leave the platform in order to go and hunt down the right crypto token, the ramp enables you to buy crypto simply via the plugin sitting right there on the platform. The crypto you purchase is then sent to your own personal crypto wallet where you maintain custody of it, even while you’re using it to interact with blockchain apps.
OK, So What is a Crypto Off-Ramp?
Easy – a crypto off-ramp is simply the on-ramp in reverse. You can use the ramp plugin to exchange your crypto for your local fiat currency. Depending on the particular provider’s capabilities, you can then remit the funds back to your debit or credit card, or even to your bank account.
Alchemy Pay’s off ramp capabilities mean we are able to remit funds to any Mastercard and Visa card, and we are able to send funds to bank accounts in over 50 government currencies.
Third Party Payment Providers
The ramp itself is usually provided by a third party payment provider (such as Alchemy Pay) who generate income by charging transaction fees for the service.
Many times a platform or dApp may integrate more than one payment ramp solution. This is because users may find that the payment providers will offer them different prices depending on the region they are in. Furthermore, the success rate of transactions can vary depending on the geographical location of the user, as well as a number of other aspects of the payment scenario.
A payment provider’s network of partners is crucial to the cost and efficiency of transactions. A payment provider’s operating costs and, by and large, depends on their network of partners within the traditional payments industry as well as their partnerships with crypto and over-the-counter exchanges. Payment routing optimisation is the practice of routing transactions between payment providers and financial institutions in the most efficient and cost effective way possible.
The crypto sector is still considered high risk by traditional financial institutions so third party providers use their working experience of the industry to navigate the risk. By doing so, they become the key piece of infrastructure that connect the traditional and crypto global economies. The aim, of course, is to make it as seamless as possible!
Know Your Customer and Anti-Money Laundering
Laws around the world usually dictate that any user wishing to purchase crypto with legal government currency must undergo know-your-customer (KYC) and anti-money laundering (AML) procedures. Most crypto ramp providers will insist that new customers share certain personal documents to verify their identity. The KYC and AML processes are usually outsourced to a specialist, rather than being carried out by the ramp provider themselves.
Easy and Direct
Crypto on and off-ramps cut out drastically reduce the steps required to buy crypto and participate in web3 dApps, they make the blockchain world more accessible than ever before. Decentralized money and applications deserve to be tried by everyone, not only the tech-savvy.
About Alchemy Pay Ramps
Alchemy Pay’s ramps allow easy access to crypto and web3 services to users all around the world. The ramps are easily integrated on platforms such as DeFi protocols, NFT marketplaces, and metaverse virtual worlds, and enable direct purchase of crypto via credit and debit cards, mobile wallets, and bank transfers. Through its network of remittance partners, Alchemy Pay’s ramps also facilitate convenient offboarding from crypto to fiat currency. The network’s capabilities include remittance to all Mastercard and Visa cards and to bank accounts in over 50 local fiat currencies. ACH is Alchemy Pay’s utility token, on Ethereum and Binance Smart Chain, is used for reduced transaction fees and for rewarding network use.
Blog written by Robert McCracken, Ecosystem Lead at Alchemy Pay
