A cryptocurrency gateway is a software solution that allows automatic, real-time cryptocurrency-to-cryptocurrency or cryptocurrency-to-fiat transaction processing. Depending on the purpose, the users of the cryptocurrency gateway are online stores, cryptocurrency wallets, exchanges for buying and converting cryptocurrencies, crypto swap services, DApp, or games.
Cryptocurrency payment processing does the following tasks:
- registers the payer’s data, for example, the card number, and sends a request for clarification to the issuing bank;
- converts cryptocurrency into another cryptocurrency, or fiat into cryptocurrency at a fixed or floating rate, depending on the conditions agreed with the crypto-processing provider;
- performs user verification, for example, through KYC;
- accepts payment from the buyer;
- sends the equivalent to the merchant in the required currency;
- provides confirmation of the transaction for both sides of the transaction;
- sends transaction data to the blockchain and records nodes confirmation;
- converts digital assets into fiat funds.
The cryptocurrency gateway connects the world of fiat funds and the cryptocurrency economy. Thanks to the technology, there is a coordinated process of interaction between the blockchain, cryptocurrency wallets, exchange services, the issuing bank, the acquiring bank, and, finally, the systems that process currency transactions (financial processors).
As for the format of the work, the processing of cryptocurrency payments can be divided into three directions: fiat-cryptocurrency, crypto-crypto, and crypto-fiat. Let’s consider the example of exchanges, wallets, and e-commerce.
How to use a fiat-to-crypto gateway
By integrating a crypto-fiat gateway, exchanges get the opportunity to sell cryptocurrency in exchange for money familiar to the user. When an exchange enters a new market, usually a new country, it is faced with the need to enter into agreements with new issuers, acquirers, processing centers, and payment systems in accordance with current legislation. It is easier and faster to integrate a crypto-fiat gateway that already takes these points into account.
Thus, users can buy cryptocurrency in exchange for fiat: pay with fiat money and automatically receive digital assets on their accounts.
How wallet owners can integrate the functions of the exchanger (crypto swap)
Wallet owners can integrate the functions of the exchanger using the API of the crypto-fiat processing gateway: users get the opportunity to exchange selected digital currencies at the rate formed in real-time on the exchanges without leaving the application and, if necessary, withdraw savings in fiat equivalent using a bank card.
Meanwhile, the wallet developer can focus on their project, entrusting the processing to a partner company.
How merchants use the crypto-to-fiat gateway
By integrating a cryptocurrency processing gateway on the site, the merchant gets the opportunity to sell products for cryptocurrency. This expands the range of customers and gives buyers more options for payment. The buyer transfers the cryptocurrency to the specified wallet number, but the merchant receives the equivalent in fiat funds to the bank account at the exchange rate valid at the time of transaction approval. Work with problematic payments, verification of the trustworthiness of the user, communication with banks, payment systems — all of this is performed by the cryptoprocessor.
ABEX is currently working on a beta version of cryptoprocessing, which you can connect using an API or integrate a widget for payment and exchange of cryptocurrencies that can be into the website.