Cryptoprocessing: How it works, who needs it and why

Crypto payment processing, or cryptoprocessing, refers to the process by which payments in cryptocurrency are processed. The first cryptoprocessor was launched by BitPay in 2011. Today, dozens of cryptocurrency processors allow buyers to pay for goods and services using cryptocurrencies.

How cryptocurrency payment gateways work

A crypto payment gateway is a service that enables merchants to accept payments in crypto from buyers. It is an intermediary that carries out the following essential functions:

  • registering payer data;
  • accepting payments from buyers;
  • sending transaction data to the blockchain and registering node confirmations;
  • converting the received crypto into fiat (at the merchant's request);
  • transferring the payments to the merchant;
  • providing the parties to the transaction with confirmation that the payment has been processed.

How payments with cryptocurrency work

Nowadays, cryptoprocessing is a reasonably widespread tool, and online stores, gambling companies, and ticketing and tour services mostly use it.

If you need to pay for a product or service with cryptocurrency, you will be prompted to follow a link to a payment page (the cryptoprocessing service generates the link). Usually, the transaction must be completed within a limited period (such as 15 minutes). These restrictions are put in place because of the high volatility of cryptocurrencies.

On gambling platforms, payments work a little differently. They require you to top up your account wallet to avoid strict time limits. Average transaction times range from a few seconds to an hour.

The process is even more straightforward if you're using a QR code. Users can scan them to proceed.

Types of cryptoprocessor

There are two main methods when it comes to cryptocurrency payment processing.

  • Crypto–fiat. With this payment processing model, the merchant receives fiat money in their bank account after the conversion. 
  • Crypto–crypto. With this model, the seller receives cryptocurrency. No matter how many types of coins they accept, they can only receive payment in one nominated crypto asset.

Regardless of whether the crypto–fiat or crypto–crypto model is used, the crypto processor is responsible for the conversion, managing exchange rate risks, and ensuring that the assets end up in the seller's crypto wallet. 

Why businesses need cryptoprocessing

Receiving payments for goods and services in cryptocurrency represents a new segment with real potential. Firstly, sellers can offer their consumers more payment options, and secondly, they can attract new customers who, for several reasons, prefer to pay with crypto.

Crypto payments offer some other benefits:

  • Security: Cryptocurrency transactions are securely protected, while information about them is stored in the blockchain and cannot be changed;
  • Commissions: Cryptocurrency transactions generally incur lower fees than bank transfers; 
  • Geography: Crypto can be used to pay for goods and services anywhere in the world. Making a payment from one country to another using a bank card or digital wallet is not always possible;
  • Reliability: In traditional processing systems, a transaction can be rejected for many reasons, whereas it is impossible to block a cryptocurrency payment;
  • Speed: Withdrawing funds from a digital wallet can sometimes take up to a week. Cryptocurrency withdrawals are orders of magnitude faster.

So, we've established that accepting payments in crypto is profitable, convenient, and a safe bet for the future. You might, however, be wondering why businesses need cryptoprocessing. After all, you only need a crypto wallet if you want to receive payments in crypto. Unfortunately, it isn't so simple, even when companies opt for the "crypto–crypto" model:

  • First, you need to create invoices for customers;
  • Second, the system must be automated. Otherwise, sellers will get confused about payments and won't remember which amount came from which customer;
  • Third, if a seller wants to be able to accept payments for goods and services in several different coins, they will need an equal number of wallets. When using cryptoprocessing services, payments made in other crypto assets can all eventually be sent to the seller as a single coin, such as a stablecoin.

If you are wondering whether to develop your crypto processor or use an existing service, rest assured that the first option wastes time, effort, and money. Integrating a readymade solution from a third-party organization, which will be responsible for the smooth functioning of payment services, offering new coins, providing user support, and more is much more profitable and accessible.

Key players in cryptoprocessing

1. BitPay

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The world's first cryptoprocessor, in operation since 2011. At present, the service uses Bitcoin Cash (BCH), Ethereum (ETH), Wrapped Bitcoin (WBTC), Dogecoin (DOGE), Litecoin (LTC), Shiba Inu (SHIB), ApeCoin (APE), the GUSD, USDC, USDP, DAI, BUSD and Euro Coin (EUROC) stablecoins, and Polygon (MATIC). BitPay allows you to withdraw payments and offers a crypto wallet and crypto debit card. At the time of writing, 250+ companies and stores work with BitPay.

2. CoinPayments

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This cryptoprocessor supports hundreds of cryptocurrencies, including Bitcoin (BTC), Bitcoin Cash (BCH), Litecoin (LTC), BNB (BNB Chain), Binance USD (BNB Chain), Binance USD (Tron/TRC-20), Dash (DASH), Dogecoin (DOGE), Ethereum Classic (ETC), Ethereum (ETH), TRON (TRX), USD Coin (ERC-20), Tether (TRON/TRC-20), Monero (XMR), Ripple (XRP), ZCash (ZEC) and others. The service provides functionality for automatically converting crypto into fiat and serves over 100,000 merchants worldwide. It offers its crypto wallet, which more than 1 million users currently use, and a mobile app.

3. Coinbase

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Coinbase isn't just a major crypto exchange and wallet and a cryptoprocessor supporting many coins. Shopify, PrestaShop, and WooCommerce are among its clients, and numerous other large companies worldwide.

4. B2BinPay

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A cryptocurrency processor launched by B2Broker, providing support for dozens of popular coins, tokens, and 10+ stablecoins. It offers on-chain (transactions processed on the blockchain) and off-chain (transactions processed within the B2BinPay ecosystem) operations. Payment processing takes about 20 seconds.

Issues with cryptocurrency payments

Along with all the benefits and convenience that come with cryptoprocessing, these kinds of cryptocurrency payments have their problems and disadvantages:

  • High degree of volatility: Because of the high levels of volatility experienced by cryptocurrencies, sellers are at risk of receiving a smaller amount in fiat than expected. As a rule, therefore, maximum time frames are specified for payments;
  • Scalability: Cryptocurrency payment processing speeds on many blockchains are much lower than with fiat payment systems. For example, Bitcoin processes seven transactions per second, Ethereum handles up to 30, while the figure for Dogecoin is 33. Visa, meanwhile, can process up to 24,000 transactions per second.
  • Commissions: If a company wants to sell its products using the "crypto–fiat" model, the commission will need to be paid twice: once for sending coins to the exchange service and again for converting them to fiat (the buyer will also pay the network commission);
  • State regulation: In most jurisdictions, cryptocurrency isn't considered legal tender. This makes accepting coins and tokens problematic for many.


Paying for purchases in cryptocurrency – both online and offline – is profitable and convenient for many buyers and sellers worldwide, and more and more cryptocurrency payment systems are appearing on the market. The main issue is the state regulation of these payments. Many payment services have already integrated crypto solutions into their systems, and there will be many more if – or when – there is greater clarity from regulators.