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September 14, 2021

What is a Fiat Gateway?

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If you’ve ever purchased cryptocurrencies, you’ve most likely used a fiat gateway. In fact, to buy Bitcoin, Ethereum, or altcoins, a fiat gateway is required. However, if you’re new to the concepts of how cryptocurrencies travel on the various blockchains, you’re probably wondering what a fiat gateway is. Therefore, we’re going to explain this in a simple and easy way so that you can answer the question, “what is a fiat gateway?” and implement the gateway’s functionality in your next dApp.

Despite all its downsides, such as governmental control, centralization, and money printing, fiat money remains the leading type of currency. For people who are deeply involved in the crypto sphere, it may seem like the mass adoption of top cryptocurrencies is already here; however, the data shows a different picture. According to TripleA, global crypto ownership rates are less than 4%. As such, including a fiat gateway when developing dApps (decentralized applications) still makes a lot of sense. With the help of Moralis, you can easily integrate your own fiat gateway in your Web3 applications. Moralis makes this process straightforward by using the Fiat Onramp plugin. Before we go further into how to use this plugin, let’s go over what a fiat gateway or fiat onramp is.

What is a Fiat Gateway or Fiat Onramp? 

So, what is a fiat gateway? Before answering that question, we need to make sure you know what fiat is. Fiat or fiat money is a government-issued currency (USD, EUR, GBP, CAD, etc.). Furthermore, a fiat currency is not backed by a commodity such as gold; it doesn’t have intrinsic value nor use-value. Basically, fiat money has value only because a specific government maintains its value or due to parties engaging in the exchange of a particular fiat currency agree on its value. 

The word “gateway“ means a place or a way through which something can be done or achieved. Putting the “fiat” and the “gateway” definitions together, we can already guess the answer to the “what is a fiat gateway?” question. Essentially, a fiat gateway is a method that enables us to use fiat currencies to purchase cryptocurrencies. Moreover, the better a fiat gateway is, the easier and more secure the purchase of particular coins or tokens is. 

A great analogy to deepen your understanding of what a fiat gateway is, are coin machines in an arcade. When you want to use an arcade gaming machine that accepts particular tokens and possibly also rewards your top scores by giving you more of those tokens, you need to change your fiat money into tokens. For that purpose, you use coin machines. So, to “play” with cryptocurrencies, you need to change your fiat into crypto coins or tokens.

As far as the “fiat onramp” term is concerned, it’s just another expression for a fiat gateway. It also means a method that allows you to convert fiat money into cryptocurrencies.

What is a Crypto-to-Fiat Gateway?

Even though the “crypto-to-fiat” term clearly emphasizes the conversion from crypto (cryptocurrencies) into fiat, it essentially refers to a fiat gateway or a fiat onramp as well. Why? Well, the thing is that a typical crypto-to-fiat gateway also serves as a fiat gateway – it enables you to convert your fiat to a particular cryptocurrency and vice versa.

Keep in mind that many media outlets and crypto-oriented blogs tend to shorten the “crypto-to-fiat” part into just “crypto-fiat”. Thus, a crypto-to-fiat gateway and a crypto-fiat gateway mean the same thing. The fact that cryptocurrencies are relatively new and that there are no clear “playbooks” set in place, terms such as “crypto onramp”, “crypto-to-fiat gateway”, “crypto-fiat gateway”, “crypto gateway”, etc., refer to the same thing – a fiat gateway.

Fiat Onramp Examples

Now that you’re able to answer the “what is a fiat gateway?” question, it’s time to look at some fiat onramp examples. While true believers in blockchain technology advocate decentralization, the fact remains that centralized exchanges (CEXs) onboard most retail users. Why? Well, their fiat gateways tend to be easy to use; in most cases, they follow the same method as the majority of online shopping platforms, which is something people are used to. Moreover, this means that people get to use their credit cards to buy stablecoins, Bitcoin, or in some cases even several top altcoins, with Ethereum leading the pack. 

Some of the most popular fiat gateway platforms include Coinbase, Binance.US, Binance, Kraken, and many others. Furthermore, the majority of the reputable CEXs are probably the most practical way to buy cryptocurrencies for beginners. However, you need to keep in mind that they tend to charge quite high fees for that service. For instance, Coinbase charges you around a 4% fee when purchasing Bitcoin with a credit card. 

Moreover, let us mention Robinhood herein since it’s another popular fiat onramp platform. Its main advantage is zero-fee transactions. However, you need to keep in mind that while Robinhood does offer you exposure to certain cryptocurrencies, it doesn’t give you actual access to coins and tokens. This means that you can’t really buy cryptocurrencies there and transfer them to other wallets. As such, it’s not an actual crypto-to-fiat gateway. This may not matter to traders just looking to get in on the price action; however, it’s an extremely important piece of information for developers interested in utilizing specific coins or tokens. 

Fiat Onramp Types

The important part of this “What is a Fiat Gateway?” article is to familiarize you with different fiat gateway types. These include bank transfer, card payment, Bitcoin ATMs, authorized shops, and buying from other people. 

  • Bank Transfer – If available, this option typically comes with the lowest fee costs. Since exchanges are entities, they have bank accounts to which they let you transfer your fiat. This is then reflected in your dashboard, where you can purchase the most popular cryptocurrencies. 
  • Card Payment – This option is the most commonly offered one. While it is probably the most practical method, it typically involves high fees, sometimes from both an exchange as well as your card provider. 
  • Bitcoin ATMs – Bitcoin ATMs are another example of fiat onramp methods. Currently, there are many Bitcoin ATMs in many countries. Some just let you buy Bitcoin, while others also serve as a crypto-fiat gateway. However, fees vary greatly and are often absurdly high, so make sure to check that aspect before using this method.
  • Authorized Shops – Depending on your location, you may have this option available. Here you can normally use either your debit/credit cards or even cash to buy cryptocurrencies. Basically, these types of shops are nothing but over-the-counter exchanges, authorized to enable a wallet on a platform or even provide you with hardware wallets (a.k.a. cold wallets/storages). Nonetheless, making sure that a shop is reputable and trustworthy is a key essence in this case. 
  • Buying from Other People – Unless you really trust the other person, this is the riskiest way, yet still, one that many individuals exploit. Moreover, there are several databases of possible sellers and buyers, the biggest being Local Bitcoins

What is a Fiat Gateway? – A Shoutout to All Web3 Developers

If you’re already involved in Web3 development, we want to congratulate you for making this smart and bold decision to go full-time crypto early. However, in case you haven’t yet focused your programming skills on this growing industry, we strongly encourage you to do so rather sooner than later. If you think that dApp development seems to be difficult and time-consuming, let us reassure you that this is not the case. Of course, assuming you grab the right tools. 

The best tool you can grab to gain an advantage right away is Moralis. This ultimate Web3 development platform enables you to devote your maximum attention to frontend development and user experience. How? The Moralis SDK provides you with short, often single lines of code that takes care of all the arduous programming on the backend. That way, you can develop things that would usually take months in hours or even minutes. Does that sound too good to be true? If so, check out how we use the power of Moralis to build a simple dApp in three minutes. One more thing, you can start using Moralis for free. Thus, make sure to create your free account today and start delivering excellent dApps with a short turn-around time!

So, what does Moralis has to do with a fiat gateway? Thanks to Moralis’ plugins, you’re now able to add fiat onramp functionality to your Web3 applications with ease! 

Why Should You Include a Crypto-to-Fiat Gateway to Your dApp?

Getting users to utilize your dApp is a considerable challenge, and it’s not always easy to attract a larger amount of users. As such, you want to make sure that you provide your current dApp users, and new ones, with everything they might need; a fiat onramp surely falls into that category. 

If your dApp doesn’t have a built-in fiat gateway, users will automatically be forced to leave somewhere else in order to deploy their fiat for cryptocurrencies. With that in mind, any kind of Web3 application can only benefit from also having a crypto-to-fiat gateway option available. 

Fortunately, you do not have to build a fiat gateway for your dApps from scratch. When using Moralis, this is covered by its Fiat Onramp plugin

Moralis’ Fiat Onramp Plugin

Moralis now offers you the Fiat Onramp plugin, which is the simplest way to enable your users to buy cryptocurrencies straight from your dApps. The plugin supports a wide range of fiat currencies and cryptocurrencies. As soon as you install the Fiat Onramp plugin, you can start using it with this code:

Once you get to the point of actually adding this functionality to your decentralized application, we strongly encourage you to go through our “How to Add Fiat Gateway to dApps” article. In that article, you can find the exact step-by-step instructions that include creating a Moralis server, installing the plugin, and creating a dApp. 

In case you prefer to follow along with a video, hit the play button below:

What is a Fiat Gateway? – Summary

You should now be able to answer the “what is a fiat gateway?” question. If you’ve read the above sections, you know that it is a way or a method that enables users to convert their fiat money into cryptocurrencies. You also know that whether you want to trade crypto or develop on top of this new technology, you need either native coins or tokens. As such, getting acquainted with fiat gateway options for those interested in crypto is not optional but a necessity. 

Fortunately, there are various places and methods available for people looking to buy Bitcoin or other cryptocurrencies; however, centralized exchanges continue to be the most popular option. Furthermore, you’ve learned that you can typically save on fees if you manage to connect your bank account with your exchange, even though that fiat gateway tactic may not always be available. 

Aside from answering the “what is a fiat gateway” question, we’ve also told you about the ultimate Web3 development platform called Moralis. You should use the latter to your advantage if you are serious about going full-time crypto and deploying phenomenal dApps. You’ve also discovered that Moralis has a practical plugin called Fiat Onramp, which may easily be added to any Web3 application. Was that enough for you, or are you thirsty for more guidance and useful content?

On Moralis’ blog, you can dive deeper into a vast range of Web3 development-related topics, from Ethereum development to Binance Smart Chain development and much more. For instance, you can easily learn to create a BSC NFT in less than 20 minutes

Moreover, we encourage you to make use of Moralis’ YouTube channel, where we post new videos regularly. There’s a ton of high-value content there, including many step-by-step example projects for you to follow along. 

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