Key Insights:
- The earliest commercial crypto exchange occurred on May 22, 2010, for 2 pizzas. The USA also became home to one of the earliest crypto payment infrastructures.
- Bitcoin was among the first crypto payment gateways to provide Bitcoin transaction services.
- In 2013, FinCEN published guidelines related to digital assets and classified some companies as “money service businesses” (MSBs).
The United States of America is the stronghold of Crypto payments and blockchain innovation. The country holds the record for the first documented Bitcoin transaction, which took place on May 22, 2010.
Florida-based early Bitcoin developer Laszlo Hanyecz paid 10,000 BTC in exchange for 2 Papa John’s pizzas. Before this event, the very first decentralized blockchain payment took place in 2009.
On January 12, 2009, Satoshi Nakamoto, the creator of Bitcoin, sent 10 BTC to American computer scientist and cryptographer Hal Finney. With the increasing adoption, the USA became home to one of the earliest crypto payment infrastructures.
Tony Gallippi and Stephen Pair founded the pioneer payment processor Bitpay in May 2011, in Orlando, Florida. BitPay played a crucial role in enabling businesses to accept Bitcoin payments at scale.
Today, crypto payment gateways facilitate businesses and users to send, receive, and convert digital assets to fiat currency with ease. They have positioned themselves as a significant part of the growing crypto economy of the USA.
Regulations Governing Crypto Payments in the USA
Regulations covering crypto payments in the United States developed slowly during the early 2010s. In 2013, the Financial Crimes Enforcement Network (“FinCEN”) published guidance treating certain crypto businesses as “money service businesses” (MSBs).
This classification brought those MSBs under federal anti-money laundering (AML) laws and reporting laws. Today, multiple agencies regulate different parts of crypto payment activity across the nation.
FinCEN enforces AML and Know Your Customer (KYC) practices with respect to exchanges and payment processors. The SEC regulates digital assets that are classified as securities under applicable law. The Internal Revenue Service (IRS) treats cryptocurrency as personal property for taxation purposes.
At the state level, regulations vary widely according to the jurisdictions and requirements. For example, New York established new regulations for cryptocurrency in 2015 with the BitLicense. That required crypto businesses to obtain a license and comply with stringent regulations.
Other states have chosen to apply less stringent rules to encourage innovation and business development. These combined federal and state regulations are what define how crypto payment gateways operate today.
How to Make and Accept Crypto Payments?
Making Crypto Payments (For customers)
- Consumers need a crypto wallet to store and send digital currency. They select a crypto payment gateway based on what the merchant offers at checkout.
- Once selected, the gateway creates a payment address (or QR code) for the user to complete the transaction with the merchant.
- Next, the user scans the QR code or copies the payment address into their crypto wallet. After the user completes this step, they enter the payment amount and confirm it.
- The blockchain network processes and verifies the transaction, then completes settlement within a few minutes. After completion, the merchant receives the money.
Accepting Crypto Payments (For Merchants)
- In the US, Merchants must first sign up with a crypto payment gateway and provide ID verification and business account information.
- After that, the gateway provides merchants with APIs, plugins, or checkout pages for integration. They integrate the medium of their choice into their e-commerce website or point-of-sale.
- When a consumer pays, the gateway creates a unique payment request for the transaction, confirming the blockchain settlement.
- Then it notifies the merchant immediately after the crypto payment is completed. Merchants can decide to receive customer payments in either crypto or automatically convert them to fiat currency.
Top Crypto Payment Gateways Operating in the USA
OpenNode
Afnan Rahman and João Almeida founded OpenNode in 2018 in Los Angeles, California. It is a Bitcoin payment processor and infrastructure provider. Of which, Afnan is currently the CEO and co-founder, and Almeida is the CTO.
The platform comes with a robust suite of tools. That helps businesses and e-commerce platforms to seamlessly integrate Bitcoin payment acceptance. OpenNode employs the Bitcoin Lightning Network to process the on-chain Bitcoin payments and Layer-2 transactions.
Its key services include Developer APIs, E-commerce plugins, and Hosted payment pages. Developers utilize its API for customized payment integrations and programmatic payouts. At the same time, the merchants employ its plug-and-play modules to their Shopify and WooCommerce stores.
The platform allows users to receive settlements either in Bitcoin or automatically converted to USD. OpenNode charges a standard process fee of 1% on every payment transaction. However, it allows the fiat conversion to be completely free.
OpenNode adheres strictly to regulations and is registered as a Money Services Business (MSB) in the United States. It complies with Anti-Money Laundering (AML), Anti-Terrorist Financing (ATF), and OFAC sanctions protocols.
Blockonomics
Nowadays, most processors operate as custodial platforms and provide fiat conversion services. Unlike them, Blockonomics operates as a fully decentralized, non-custodial crypto payment gateway. It requires no KYC verification or legal documentation, and is primarily focused on Bitcoin.
Shiva S. founded Blockonomics in 2015. They initially launched it as a wallet watcher and blockchain explorer. Later, the platform evolved to a crypto payment processor. It doesn’t hold any financial license.
Blocknomics doesn’t process fiat currency, hold funds, or act as a financial third party. It only offers the open-source software and tracking infrastructure. That is directly linked to the user wallet’s xPub key. This working method exempts them from Money Services Business (MSB) regulations.
Blockomics charges a 1% processing fee from the merchants. Its free trial supports 10 to 20 transactions for new users. It maintains a unique prepaid billing method, as the customer’s payment is sent directly to the retailer’s personal wallet.
The merchants maintain a credit on their dashboard. At the time of the transaction, Blockonomics deducts its 1% fee from the prepaid balance.
Solana Pay
Anatoly Yakovenko and Raj Gokal launched Solana Pay in Feb 2022. They developed it in a collaboration with Solana Labs, ShakedX, Circle, and other ecosystem contributors. Solana Pay connects merchants directly with consumers, without any middlemen.
Instead of a commercial service, it runs as an open-source library and decentralized rail. Hence, the platform doesn’t charge any monthly setup or transaction-processing fees. Businesses and consumers only pay a standard blockchain transaction fee. That is typically around $0.00025 to $0.0005 per transaction.
Solana Pay is a non-custodial crypto payment gateway that holds no regulatory financial licenses. It requires no KYC/AML authentication. It facilitates direct merchant-to-customer payments in real time (400 milliseconds), eliminating the need for traditional credit card networks.
Solana Pay supports multi-asset transfers and accepts USDC, SOL, and any Solana Program Library (SPL) token. It features plugins for Shopify app integration and standardizes a URL specification, which transforms payment details into a QR code.
Solana Pay facilitates interactive Blockchain “Actions” (Blinks0. This allows businesses to turn any QR code or link into an interactive and instant payment button. They post these buttons on Social media with their product. Consumers make payments directly there, without visiting an external website.
CoinsPaid
CoinsPaid is an enterprise-grade European crypto payment gateway with headquarters in Tallinn, Estonia. Max Krupyshev launched this fully custodial and highly regulated platform in 2014.
It works as a bridge between digital assets and fiat currencies and is highly dominant in high-volume industries. Coinspaid doesn’t charge any monthly maintenance fees. However, it requires merchants to pay an average fee of 0.8% on payments and transfers.
CoinsPaid also features crypto-to-fiat conversion services. For each conversion, it charges approximately 1.5% fee for converting crypto and withdrawing it directly to the bank account. The platform provides some relief to its enterprise clients, which process millions in monthly volume.
CoinsPaid adheres to stringent compliance and favors institutional transparency. It holds Estonia’s Financial Intelligence Unit (FIU) license and is registered as an EU-licensed virtual currency service provider.
The platform doesn’t possess any MiCA license. However, its operations align with its internal compliance framework. In the US, CoinsPaid’s entity is registered with the FinCEN as a Money Services Business (MSB).
It is just a registration, not a license. This arrangement ensures they comply with the Bank Secrecy Act (BSA) and strict federal Anti-Money Laundering (AML) reporting requirements. Having no license means they can’t operate as a local retail-to-exchange across all 50 states.
Bankoro
Bankoro was incorporated as Bankoro Ltd. on December 7, 2017, in London, United Kingdom. In later years, it evolved as a dual-faceted fintech platform, split into two core ecosystems: Bankoro.io and Bankoro.com.
Bankoro.io operates as a global crypto payment gateway, while Bankoro.com works as a Banking-as-a-Service infrastructure provider. The payment processor doesn’t charge any fee for merchant onboarding.
The setup and monthly subscription costs are zero. However, it charges a processing fee built directly into checkout pages and during the crypto-to-cash conversion.
The banking arm of Bankoro Ltd. received its Electronic Money Institution (EMI) license from the UK’s FCA in 2018. This registration enabled Bankoro to issue digital money and offer IBAN current accounts. They could now also handle global fiat wire transfers legally.
Bankoro.io (crypto gateway) is completely separate from Bankoro.com’s EMI banking framework. This allows the fast cross-border crypto payment service to remain unaffected by local banking restrictions.
Crypto Payment Gateways are Here to Stay!
Crypto Payment Gateways connect blockchain technology to everyday businesses. That makes it easier for both the merchant and consumer to transact in cryptocurrency.
These platforms accelerate payment speed, enabling automatic conversion and easy integration into any online business. At the same time, regulatory entities such as FinCEN, the SEC, and the IRS are providing regulatory oversight and compliance. These clearer rules ensure a safe and secure user experience.
Blockchain technology and regulations will continue to evolve together. With them, Crypto Payment Gateways too are set to grow into larger and more impactful financial institutions.
