What is Fiat On-Ramp?
Let's find out Fiat On-Ramp meaning, definition in crypto, what is Fiat On-Ramp, and all other detailed facts.
Fiat on-ramp refers to the method or service that allows customers to exchange fiat money into cryptocurrency. The platforms that enable on-ramp operations are usually exchanges. The fiat-crypto transaction amount on an exchange platform is based on the market rates at the given time.
There are three methods to get cryptocurrencies or other blockchain-based assets.
The first method is mining. This required computing power to solve hashes that yield rewards in the form of crypto coins or tokens. The second way is selling goods or services and accepting cryptocurrencies as a potential payment method.
The first two options may not be possible for some parties because they do not have appropriate hardware for mining or do not sell any services. The third option, fiat on-ramp, allows users to purchase cryptocurrency with cash. Customers can go to a cryptocurrency exchange platform or a crypto ATM and exchange fiat currency for crypto.
Such an exchange method is referred to as on-ramp as it allows the user to access the whole cryptocurrency ecosystem. Off-ramp, on the other hand, refers to the opposite process when cryptocurrency is converted into fiat money. Off-ramp may also refer to exchanging cryptocurrency for goods and services.
If a customer wishes to extract their cryptocurrency from the blockchain network and into the real world, they must use off-ramp services to trade their digital assets into fiat currencies. In most parts of the world, fiat currencies are the primary means of currency that act as legal tender, and the usability of cryptocurrencies is limited.