The friction between the decentralized, cypherpunk ethos of cryptocurrencies and onboarding the mainstream — along with financial institutions — has led to a significant user-experience problem in the sector. Businesses have to undergo convoluted exchange and transfer processes between native utility and project tokens, liquidity is lacking, and interfaces tapping decentralized protocols are complex.
As a result, it’s not surprising that the relationship among crypto-oriented companies and conventional financial institutions remains tenuous at best.
In an effort to bolster the bridge between the world of legacy finance and blockchains, some firms are taking a compromising approach — catering towards crypto projects and traditional enterprises.
One of those firms, Eterbase, is an emerging crypto-fiat exchange and gateway in Europe, fusing fiat IBAN and crypto into one platform, compliant under the EU with bank-level KYC. And Eterbase’s most recent initiative, the Eterbase Treasury Gateway, provides a glimpse into a more promising landscape of B2B payments between crypto projects and conventional enterprises.
Bypassing Hurdles & Building Bridges
Eterbase’s unique standing among crypto exchanges, particularly in Europe, is due to several factors. For example, the firm has an official monetary license via the Majestic Omnibank Payment Platform, Corporate Crypto-Friendly Fiat/SEPA Accounts, Synthetic IBAN accounts on the exchange, and direct EU compliance.
Compared to the broader industry, many of those pillars are not only hard to attain but also maintain. Relationships between banks and crypto projects are notoriously unstable, regulatory statuses of many exchanges are in question, and fiat gateways for crypto assets are typically too cumbersome for enterprises to use efficiently.
“Currently, B2B focused blockchain projects have developed several use-cases for their token as part of their tokenomics,” details the Eterbase announcement for the Treasury Gateway. “Most of them require their native token to be used as payment for their services.”
Most token models are built on the premise of capturing value within a closed system, however, that mechanism has often come at the expense of usability and transaction costs.
“Their clients (non-blockchain businesses) need to convert FIAT to Crypto, deposit it onto an exchange, buy the project’s native token and then pay for the service,” details Eterbase.
The costs take the mold of both time and regulatory processes, which inevitably lead to more sunk financial expenses. For enterprises seeking to tap into the advantages of crypto projects, these costs can become prohibitively expensive, limiting the capacity of the crypto projects to make a positive impact outside of the esoteric crypto market.
Eterbase circumvents this problem by leveraging its partnership with Majestic Omnibank Payment Platform to enable Treasury Gateway clients to receive EUR SEPA IBAN in their projects’ name, with direct payment accounts for all 28 EU member states.
At a high level, this means that non-blockchain related enterprises can financially interact with crypto projects without going through convoluted token payment and exchange processes. Instead, they receive fiat payments directly through corporate-grade IBAN accounts.
“This means they don’t have to go through the intense process of figuring out what FIAT on-ramp to use, which token to buy, what exchange to deposit them on and how to buy the project’s native token,” details the Eterbase team.
The Blend of Blockchain With Legacy Enterprises is Accelerating Market Maturity
Numerous advantages are available for legacy enterprises to leverage the power of crypto and blockchain projects — from DeFi credit instruments to cross-border payments with reduced transaction costs.
Historically, the problem with accessing these services has been the underlying complexity of the technology and high technical barrier for enterprises to use the tools offered by blockchain-oriented firms. Compounded by uncertain regulatory environments in many prominent regions of the world, many enterprises have sat on the sidelines waiting for more maturity in the blockchain and crypto industry.
There are clearly still some market microstructure problems in the crypto sector, particularly concerning the momentum effect of exchange consolidation. However, fully-compliant pushes by emerging exchanges like Eterbase are promising not only for leveling the liquidity and price discovery of high-profile fiat trading pairs (e.g., BTC/EUR), but also in onboarding formerly hesitant enterprises to join the ecosystem.
Eterbase is targeting the inclusion of over 50 projects into the Treasury Gateway over the next 6 months, which is fueled by a surging interest they are receiving from companies. With a slew of potential partners in tow, Eterbase envisions the Treasury Gateway sparking a boost in its XBASE/XBASEB token, which already incentivizes market makers on the platform with negative trading fees.
Expanding the use case of XBASE, along with Eterbase’s recently announced EurBase stablecoin, should serve to attract more enterprise customers to its platform, diminishing many of the B2B barriers in crypto adoption in the process.