The Lurking Danger for Crypto Companies: Neglecting Fiat-Crypto On- and Off-Ramps

Bora Can Sekerel
Date Published
May 9, 2022
Read Time

The Bitcoin 2022 conference in Miami was as exciting as we’ve come to expect. Peter Thiel, the famous contrarian venture capitalist, ascended to the main stage and began his speech by tossing $100 bills into the crowd in an attempt to show the difference between crypto and fiat currencies. Surprised by the folks rushing to collect the $100 dollar bills, “I thought you guys were supposed to be Bitcoin maximalists,” exclaimed Thiel.

Mr. Thiel is not alone in thinking that one has to be either pro-crypto or pro-fiat. However the reality — as always — is nuanced so let’s not throw away our Benjamins just yet. Cryptocurrencies and blockchain are emerging technologies with great potential to eliminate central “validators,” make our transactions cheaper and faster, and bring the long-desired stability in an inflationary world. However, just as with any new emerging technology, it’s fair to expect a transitional period where the “old” fiat currencies will coexist with the “new” cryptocurrencies. The winning companies of the “crypto-first” world will be the companies who navigate this transition period the best.

Winning the fiat-crypto transition period

Here are three simple things crypto companies can do today to ensure that they navigate the fiat-crypto transition successfully:

  • Launch your crypto-backed credit card: End-users with assets in cryptocurrencies are demanding to have the option to spend without selling their crypto investments. A crypto-backed spending card bridges this gap well. Crypto-denominated rewards for usage could be an additional attractive bonus to make it a top of wallet card!
  • Build your fiat-crypto on-ramp: Unfortunately, more than two-thirds of Americans still live paycheck to paycheck. Embedding a fiat bank account into your app or website to deposit paychecks is the first step to enabling access into the crypto ecosystem. This eliminates lengthy ACH processes and makes investing in cryptocurrencies a one-click delight. 
  • Offer your crypto-backed lending service: Select end-users demand to borrow fiat against their crypto savings to remain invested in cryptocurrencies. Being able to provide this lending service lengthens the relationship with your end users, reduces churn, and thus improves your customers’ LTV (lifetime value) significantly. 

You no longer need tens of engineers to build these products, manage fraud, and navigate complicated compliance requirements on your own. In our mission to democratize financial services, we’ve created plug-and-play embedded financial services for crypto companies that can be launched in a matter of weeks. Numerous Bonds crypto customers have already expanded their valuation multiples by offering these financial products and becoming a Crypto-Fintech. If you’re interested in maximizing this fiat-crypto transitionary period, schedule a demo with Bond today!