The success rate of crypto transactions depends on the user’s location: Report
The crypto community is constantly searching for ways to bridge the gap between traditional finance and fiat currencies with decentralized finance (DeFi) tools. Crypto on-ramp platforms are a primary way users can cross between these two financial ecosystems.
However, a new report by Cointelegraph Research and Onramper, a crypto-based financial services provider, revealed that 50% of fiat-crypto transactions fail, even after Know Your Customer is completed.
Furthermore, due to difficulties in the transaction process, interruption of transactions during the purchase flow can be as high as 90%.
The survey looked at nine of the biggest fiat crypto onramps, including Coinify, MoonPay, Transak and Wyre, among others.
According to the data, the performance of different onramps is very different, although one of the main factors includes user location. Europe had the highest success rates in transactions, while the lowest are found in Africa and South America.
Other factors that affected transactions on crypto onramps include payment methods, fiat used to convert to crypto and available trading pairs. Bank transfers as a payment method were proven superior in terms of transaction success rates, achieving close to 100% success in two cases.
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In addition, transaction value was a key indicator of success, with smaller transactions worth $0-26 achieving a 66% authorization rate, compared to transactions over $5,000, which typically have a 19% authorization rate.
The research concluded that potential solutions to transaction authorization problems could be for token service providers to offer as wide a range as possible of aggregated onramps in a single interface. Another is dynamic routing of transactions to provide users with the best option for their situation.
Recently, at the World Economic Forum, Tether Chief Technology Officer Paolo Ardoino called the platform’s stablecoin Tether (USDT), an on-ramp for Bitcoin (BTC).
The Hong Kong Monetary Authority also described its upcoming central bank digital currency as a potential entry into the DeFi space.
Disclaimer: Research for this article was prepared in collaboration between Cointelegraph and Onramper.
