Direct Crypto On-Ramps Promise To Change The Game For Web3 dApps

From the jungles of northern Thailand to the steppes of Mongolia, people everywhere want an easy way to buy cryptocurrencies. But unfortunately, doing so is not always such a straightforward process.

Crypto on-ramps have traditionally been clunky affairs. A few years ago, the only real option for most people was to purchase their crypto from a centralized exchange platform, or CEX. Big exchange platforms such as Binance, Kraken, Bybit, and Coinbase, to name just a few, have accepted fiat purchases for a number of years already. They accept a range of payments, including credit cards, debit cards, bank transfers, and sometimes even a check. The relatively seamless nature of these on-ramps has a lot of appeal. 

However, CEX platforms have come under the microscope recently. In 2022 a number of these platforms went bust, dragging their reputation into the mud. First, we saw the failure of Three Arrows Capital and Voyager Digital, and that was followed by Celsius, one of the leading such platforms in the U.S. Then came the almighty collapse of the FTX exchange, which was once the world’s second-largest CEX. Following a run on the bank, it went bankrupt with an enormous, $8 billion hold in its accounts, leaving thousands of customers with no way to recover their savings. 

As a consequence of these events, consumer trust in CEX platforms has diminished, and the industry now faces major roadblocks as regulatory uncertainty comes to a head. 

Integrated on-ramps for dApps

The growth of decentralized finance has led to a new kind of on-ramp that eases onboarding to users in the wider world of Web3. Although DeFi is still relatively unknown to most people, it has attracted billions of dollars in capital. According to DeFi Llama, there is more than $45 billion in total value locked in the DeFi industry, and it has the potential to grow much bigger. 

However, DeFi needs superior on-ramps to smooth the user experience. Until recently, getting involved in DeFi was only possible in a roundabout kind of way. First, investors would need to head to a CEX to purchase crypto. Then, they had to transfer those funds to a self-custody wallet. Only then could they link their wallet to the DeFi protocol they wanted to use, 

As such, the ability to on-ramp directly within DeFi dApps is an attractive one. Crypto on-ramp platforms such as Ramp Network, Transak, Moonpay and Simplex have emerged to answer this call. They provide users with a convenient way to skip the CEX and purchase crypto directly from the protocol they’re using, including dApps and also decentralized exchanges. 

Ramp has created an API-based on-ramp service that developers can integrate directly into their dApps, allowing their users to easily purchase crypto with fiat via a range of payment methods. The transactions take just seconds, and developers can integrate the service with a few, simple lines of code. Not only is it more convenient, with support for payment processors like PIX, but Ramp is also highly regulated, making it attractive to institutional investors. Its platform has been certified by the U.K.’s Financial Conduct Authority and the U.S.’s Financial Crimes Enforcement Network, helping to ease fears around compliance. What this means is that dApps have a way to onboard users from fiat in a way that’s safe and legal. Ramp also offers off-ramps, providing users with a way to sell their crypto for fiat easily. 

Other options include Transak, a U.K.-based platform that offers similar services with a similar level of compliance, as well as Moonpay, which is known for its user-friendly interface, and Simplex, an Israeli platform that was one of the first such providers of its kind. 

Of course, buying crypto through these on-ramps might not be entirely without risk, as users are still required to manage their digital wallets. Decentralized finance transactions must be treated with the same caution as any regular financial transaction, which means taking care to ensure you’re sending funds to the right address, for example.

Why Are Direct On-Ramps Revolutionary?

The advent of integrated on-ramps could well be a game-changer for DeFi and the wider world of Web3, as they allow any dApp to become a bridge between the world of fiat and crypto. One of the hottest areas of the crypto industry today is blockchain gaming, and direct fiat onboarding can make a huge difference here. After all, when a player is deeply involved with a game, the last thing they want to do is stop everything and go through the complicated process of using a CEX to buy more crypto so they can continue playing. 

With on-ramps such as Ramp, this is no longer necessary, as game developers can use its API to integrate fiat payments directly. One of its key partners is Sorare, a digital fantasy soccer collectible cards game that was founded in 2018. Each card within Sorare is an NFT that is unique and has its own attributes, with its ownership recorded on the blockchain. The trade of these cards is one of the biggest aspects of the game, and players can do its much more easily through the Ramp integration. 

Ramp also boasts integrations with other popular crypto games including the hit Axie Infinity and GameStop, another digital collectibles game. 

Another key customer of Ramp is Ledger, which sells hardware wallets that enable users to keep their crypto stored securely offline, where it cannot be hacked. By integrating with Ramp, life becomes much easier for Ledger users, as they can buy and sell crypto directly from their hardware wallet, without having to transfer their funds to a less secure location first. In addition, Ramp has added its capabilities to the Brave browser that blocks most ads, and gives users the option to earn crypto by viewing more targeted ads. 

Crypto on-ramps also make life much easier for DeFi protocols such as Aave, which allows users to borrow and lend crypto and earn rewards through liquidity pools. Rather than go through the roundabout process of buying tokens from an exchange and then swapping these for a compatible digital currency to use Aave’s dApp, users can now purchase their tokens directly within Aave thanks to its integration with Transak. It means users have instant access to all of its functionality. 

A Disruptive Force?

These kinds of direct on-ramps might not be suitable for every user. In the case of institutional investors trading with large volumes of capital, they may find a better price going through the traditional route of a CEX. However, for the vast majority of consumers engaging in smaller transactions, nothing beats the convenience of integrated on-ramps. 

Crypto on-ramps such as Ramp significantly reduce the onboarding friction, allowing users to focus on the dApp they’re using rather than struggling to buy and sell their digital assets. It’s a much smoother process that enables people to access Web3 in a more direct way, in the same way as they can access legacy apps on Web2. 

The impact will likely be similar to what PayPal and other payment providers did for e-commerce in Web2. With a direct bridge from crypto to fiat, dApp developers and entrepreneurs can focus on building better experiences without worrying about how they’ll onboard new users. Superior user experiences and more innovation will be the result.  

The advent of crypto on-ramps could become one of the biggest disruptors of our times, paving the way for millions of new users to enter Web3.