Yield App: Virtual Ibans, Fiat on-ramps & Faas vs. Baas
In an industry where innovation converges with traditional financial frameworks, bridging the realms of cryptocurrency and fiat currency is paramount for fostering broader adoption and enhanced user experience.
As digital wealth management platforms burgeon, integrating seamless payment rails and forming strategic partnerships become vital steps toward achieving a robust ecosystem that caters to a diverse clientele.
This is why we invited Gero Piskov, then Head of Cards and Payments Manager at Yield App, to discuss the journey of Yield App's inception, its evolution into a digital wealth management platform, and the pivotal role of Fiat Republic in enhancing the fiat payment rails of Yield App.
We discuss bridging the worlds of crypto & tradfi with on-ramps, virtual Ibans and the benefits of Fiat-as-a-service over Banking-as-a-service rails for crypto that speak bank.
The Inception of Yield App
Diving into the origins of Yield App, Gero shares how the digital wealth management platform has rapidly grown its customer base and assets under management since its inception in 2020. He explains the evolution from a DeFi utilisation company to a more comprehensive digital wealth management platform offering high fixed interest yield on crypto assets. With their own fiat infrastructure, they can offer some of “the best rates when it comes to the conversion of fiat to crypto and crypto to fiat,” he said.
Initially crypto-native, Yield App transitioned to offering fiat on-ramps, broadening their service scope and fostering greater crypto adoption. This move was instrumental in overcoming the restrictions of being solely crypto-native, enabling a broader range of customers to benefit from digital asset wealth opportunities.
“[W]e need to power the greater crypto adoption by connecting the Fiat and crypto world,” he said.
The Imperative of Instant User Experience
Gero discusses the significance of providing an instant user experience, especially in payments where delays can critically impact user satisfaction. He quotes, “[E]verybody is very sensitive about their money…If you don’t provide instant solutions for the currencies where you can provide those, you are behind the competition. [Similarly], liquidity issues are also resolved. Settlement with different counterparties for any company is … of the highest importance. And obviously, the instant trails and payments provide you with that kind of flexibility and solution to that … issue,” underscoring the competitive necessity of instant solutions in modern payment infrastructures.
Read more about the importance of liquidity in cryptocurrency here.
Engagement with Traditional Banks
The conversation shifts towards Yield App’s efforts to collaborate directly with banks, revealing the hurdles encountered due to the prevailing crypto aversion among traditional financial institutions. Gero mentions, “not many banks are really crypto friendly…a direct cooperation with a bank would bring certain positives to a crypto company, [but] it’s really hard to achieve such” shedding light on the unyielding barriers between the traditional and crypto financial realms.
As Fiat Republic CEO Adam Bialy has expressed, for many banks, the issue is not one of disinterest but rather lack of trust: “[B]anks want to get into crypto, but are only dipping their toes in the water rather than knowing how deep it is and taking the plunge.”
Exploration of Fiat Provider Solutions
Gero discusses the limitations of traditional banking-as-a-service models, particularly the restrictions on currency support and API capabilities. He explains, “[M]ost of those companies provide payment infrastructure and services to many industries. So, their APIs are not tailored for crypto companies, which [causes] specific types of issues and complications itself.”
From API complications, liquidity issues & barriers with traditional banks, it was a relief to discover Fiat Republic’s crypto-tailored fiat-as-a-service model.
Swift Integration Experience
Gero shares his positive experience with the swift integration process facilitated by the well-suited APIs, emphasising the efficiency and quality of the integration completed in just a few weeks. He appreciates the process, stating, “Integrating was literally very fast… It took us just a few weeks.”
Adoption of Virtual IBAN’s
The conversation touches on adopting virtual IBANs, deemed an industry benchmark for simplifying reconciliation processes and ensuring seamless user experiences by promptly matching transactions to users. Gero highlights their benefits: “Virtual IBANSs obviously provide a solution to all of those issues.”
A Collaborative Compliance Approach
Discussing the compliance approach of Fiat Republic, Gero appreciates the strict yet crypto-focused compliance procedures which align with Yield App’s long-term vision. He notes, “[Fiat Republic is] very strict when it comes to compliance, …you’re really focusing [on] crypto, which makes the perfect combination.”
Transaction Monitoring: Fiat Republic’s Oxygen Platform
Lastly, Gero explains the rationale behind choosing Fiat Republic’s Oxygen Platform for transaction monitoring. He highlights the ease of integration due to existing partnerships, the expedited setup, and the enhanced notification system through Webhooks, which significantly improves their readiness to respond to suspicious activities.”the integration was a few days … It was so easy. [Y]ou already have all the payments data any transaction monitoring system would otherwise need to import into their infrastructure and run through their different rules. So that’s one of the reasons we chose it.”
Watch the interview fully if you’d like to catch the rest of the conversation. Otherwise, learn more about our unique fiat-as-a-service solution here.