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One thing everyone’s knows about international transfers is the excessive processing time. Also, depending on the payment method or network, it can involve multiple corresponding banking relationships. For example, with SWIFT, banks act as the middlemen for secure fund transfers between currencies and the average processing time can take 18 hours.
Multiple intermediaries mean complex regulatory laws and banking practice, adding to the transfer fees. For small to medium-scale businesses, the costs add up when considering currency fluctuations and exchange rates.
Although the industry has seen massive growth in terms of providing more access, the same isn’t true for payment protocols. According to this 2024 report, nearly 40% payment firms have lost out on business deals due to cross-border issues.
Unsurprisingly, the major barriers to integration were security, payment tracking, and processing speed.
Sending crypto as an alternative to traditional payment rails
Crypto remittances are a practical alternative in cases where traditional fiat transfers can be expensive or limited.
Whether it’s accessing money in countries with economic instabilities or moving money between multiple intermediaries — cryptorails can become a global payments solution. In fact, this is precisely why Striga’s API solutions exist. Building a compliant payment service to transfer crypto with an efficient payment protocol.
Payments orchestration solutions have vastly improved the cross border functionality. And while it provides an increased accessibility, it doesn’t address the main issues — slow and expensive payments.
The payment protocols used in such cases largely operate under the same legacy systems. But before we explore how sending crypto fares as an alternate solution, let’s first understand what payment protocols are and why they matter.
In the payments ecosystem, messaging protocols:
- Establish frameworks defining the structure and flow of information in payment transactions.
- Ensure standardised formats and security protocols that allow seamless processing.
- And, maintain interoperability and regulatory compliance.
Crypto remittances are gaining legitimacy and traction amongst growing regulations enabling a faster, safer, and cheaper alternative to money transfers.
Regarding how to send crypto to avoid unnecessary fees and delays, here’s how Striga enables it. Euro account holders can onramp to a wallet using instant SEPA and crypto accounts can make on chain transactions by specifying the address. Then, using a payment service provider, the user can either convert it to the local currency and off ramp into fiat, or hold the cryptocurrency in a non-custodial crypto exchange wallet.
There is, however, a caveat to this.
While swaps and exchanges are convenient on-chain, the major issue arises when users need to cash out. In such cases, they have to rely on traditional banking services, thus repeating the process of slow and expensive transactions all over again.
But why does this problem persist even after gaining retail popularity?
Not enough acceptance, not enough crypto payout
Much like the chicken and egg situation, it’s not the norm to transfer crypto as an everyday payment because fewer merchants accept it… because fewer people pay in crypto.
A major volume comes from emerging markets engaging in creator/freelance business, vendor payouts, and gaming industries. Even then, a large section of people are discouraged from using it because it’s considered “fake money”. Lastly, there are people who only ever use it for crypto off ramps.
So unless the adoption increases, businesses won’t be incentivized into accepting it.
When traditional payment settlements take 3-4 business days, crypto debit cards can instantly complete transactions without any prefunding. Cutting down on processing time and cost.
Sounds like straightforward logic.
For emerging markets, merchants engaging in international businesses have to deal with multiple local payment systems. They can divert unnecessary FX fees, especially on fluctuating currencies, if they figure out how to send crypto payments. It’s why SpaceX uses stablecoins — to avoid unnecessary complications that come with wire transfers.
Especially with slow payments being a major concern amongst SMBs. In a study conducted by VISA, 90% of end users consider a waiting period of two days or more as “too long”.
Integrating with existing traditional payment systems can solve this and ease users into the crypto ecosystem, thereby improving interoperability.
More than just an investment asset — the good money, bad money problem
Another group of users consider crypto — particularly Bitcoin — as an investment and not so much as currency. And for legitimate reasons.
Unlike the inflationary fiat currencies, cryptocurrencies have a limited supply – making it a hedge against inflation. This is specifically the case with Bitcoin where the deflationary properties are comparable to gold, as opposed to altcoins or memecoins.
And thus the logic behind why crypto isn’t used the same way as EUR or USD. The primary use case still revolves around exchange and trading since the purpose doesn’t involve using crypto as literal currencies.
Bitcoin proponents liken this to Gresham’s Law where “good money” (in this case Bitcoin) has to compete on the leveled playing field as “poor money” (fiat currencies) and merchants have to accept them at their face value. Eventually, people tend to save stable currencies and spend depreciating ones.
Which proves the logic behind the law. Bitcoin is not used in everyday transactions because people prefer to hold on to them for its investment-worthy nature.
API solutions to transfer crypto efficiently
So which is it then? Is crypto a hedge against an unstable financial future? Or a practical alternative to everyday fiat currencies? That’s an extended discussion between proponents and critics.
But for the time being, Striga has solutions for all things crypto. Because businesses shouldn’t slow down in the face of regulatory complexities or shifting technologies.
Every use case has an API solution. Whether it’s for onramp and off ramp, seamless cross border transfers, or simply buying coffee with a crypto debit card — build your product on Striga’s crypto banking ecosystem.
Striga Crypto-native Banking as a Service:
Your path to building and launching financial products
Join the financial businesses that use Striga’s cloud platform to delight their customers and launch their own products without the complexities that come when dealing with core banking solutions’ relationships, licensing, compliance and payments methods.
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