To date, Coinbase is the largest fiat onramp for people to enter the cryptocurrency markets, but many speculate that now Binance can become a serious competitor. While this may be a threat for Coinbase, it’s a major upside for the market as a whole. The more fiat onramps that exist in the crypto space, the better.
It is worth noting that some enthusiasts in the cryptocurrency community are against fiat gateways since Binance can now gather personal information, but for the most part, the community is positive.
Along with the announcement, Binance mentioned three primary benefits of accepting credit and debit card payments:
1. Speed. Users can expect an average wait time of only 10-30 minutes before their cryptocurrencies arrive in their wallet.
- Low fees. Users can expect fees of only 3.5% or $10 USD – whichever is higher.
- Convenience. Visa and Mastercard accepted.
Currently, users can purchase Bitcoin, Ethereum, and Litecoin with fiat on Binance. From there, users can speculate on the hundreds of cryptocurrencies they offer.
Binance CEO, Changpeng Zhao commented on the matter by saying, “The crypto industry is still in its early stages and most of the world’s money is still in fiat. Building fiat gateways is what we need now to grow the ecosystem, increase adoption and introduce crypto to more users.”
Binance enabled debit and credit card payments in partnership with Simplex, “a FinTech company providing guaranteed fraudless payment processing solutions. Simplex processes credit card payments with a 100% zero fraud guarantee – in case of a chargeback, the merchant gets paid by Simplex. The cutting-edge Simplex fraud prevention solution and proprietary state-of-the-art AI technology stops fraudulent transactions and allows more legitimate ones to complete payments with ease and speed while increasing conversion rates and enabling merchants to focus on their business growth,” according to Binance’s press release.
Simplex CEO Nimrod Lehavi also commented on the partnership by mentioning that, “easy and fast credit card payments, for mainstream users, is a key factor in wider adoption of crypto in general. We’re thrilled to partner up with Binance and together enable a much better, fast and easy experience.”
Binance has the largest trading volume and is capable of processing over 1.4 million orders per second, which is partially why they have gained the community’s trust. Most cryptocurrency exchanges cannot handle this amount.
Hopefully in the future, more cryptocurrencies can be purchased with fiat, but for now, the three major ones they listed is a good start. The more cryptocurrencies that are exposed to direct fiat relationships will undoubtedly perform better. Perhaps the reason that Bitcoin, Litecoin, and Ethereum are valued so highly is because they are the main bridges connecting the fiat and cryptocurrency worlds. Users around the world have no choice but to purchase these before investing in other alternative cryptocurrencies (altcoins).