MoonPay Business Model In A Nutshell

  • MoonPay is a fintech company founded by Ivan Soto-Wright and Victor Faramond in 2019. The pair wanted to create a platform that made cryptocurrency fair and accessible for everyone.
  • MoonPay facilitates instant, non-custodial transactions in a marketplace that connects payment cards, banks, and cryptocurrency exchanges. The company is sometimes referred to as the “PayPal of cryptocurrency” as developers can utilize a branded widget within their applications or use an API for more customization.
  • MoonPay makes money via payment fees, processing fees, and a concierge service for wealthy individuals.

Origin story

MoonPay is a fintech company founded by Ivan Soto-Wright and Victor Faramond in 2019. 

The MoonPay story began in the summer of 2018 as Soto-Wright and Faramond were frustrated with the way users were onboarded into cryptocurrencies. In response, the pair created a simple, safe, and affordable solution that would allow users to buy and sell major cryptocurrencies using conventional payment methods such as credit cards and bank transfers.

The platform took off after MoonPay was able to secure its first partnership with cryptocurrency exchange Bitcoin.com. Over the following years, the small team worked hard and continued to add new partners and offer an increasingly diverse range of cryptocurrencies, such as BTC, DAI, BNB, ETH, NANO, LTC, XTZ, ZEC, and ZIL.

The company moved to a valuation of $3.4 billion after a Series A funding round worth $555 million in November 2021 – the most any bootstrapped crypto company had secured to date.

Business model

In essence, MoonPay is a creator of developer tools for fiat-to-crypto transactions.

The company facilitates instant, non-custodial transactions in a marketplace that connects payment cards, banks, and cryptocurrency exchanges. MoonPay is sometimes referred to as the “PayPal of cryptocurrency” because developers can utilize a branded MoonPay widget within their applications. Alternatively, they can use the MoonPay API if they desire more customization.

This service allows crypto companies to build streamlined and seamless purchase experiences for consumers in more than 150 countries. More than 5 million consumers now use the company’s network of wallets, dApps, and partner exchanges.

How does MoonPay make money?

MoonPay charges a processing and payment fee for users in its marketplace. The company also makes money via a concierge service for cashed-up clients. Let’s look at these streams below.

Processing and payment fees

MoonPay charges a 4.5% processing fee for card payments and a 1% processing fee for bank transfers when a user purchases cryptocurrency. There is also a 1% fee for selling cryptocurrency. The fee structure is the same for consumers and businesses.

Note that a portion of these fees is shared with the card issuer, which is either MasterCard or Visa. MoonPay also uses some portion of the fees it collects to pay for fraud detection services.

MoonPay Concierge

MoonPay Concierge is a service for wealthy individuals who desire a seamless way to purchase cryptocurrencies and non-fungible tokens (NFTs).

Little is known about how much the company charges for this service, but it is likely the fee varies on a case-by-case basis.

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