Cost efficient on-ramp to self-custodial wallet method
This article is meant for Singaporeans or a Singapore based person to on-ramp fiat to crypto through StraitsX to your crypto wallet. Disclaimer: This is not a paid article by StraitsX or any other companies mentioned in this article. Please do your own research. If you found it useful, please support me through the use of my referral links here.
Updated 15th Aug 2023
Monetary Authority of Singapore (MAS) has recently finalised its rules for Singapore-licensed stablecoin issuer. Before this announcement, StraitsX (formerly Xfers) issues and allows the redemption of XSGD, a stablecoin pegged 1:1 to the Singapore dollar. StraitsX is a Major Payment Institution licensed by the MAS. StraitsX is currently exploring on how apply for XSGD to get the MAS regulated label.
In this article, I would share the on-ramp process using StraitsX and XSGD to swap with digital assets in a self-custodial wallet. It is a relatively cost-efficient method to on-ramp to Defi or your self-custodial wallet without passage through a Centralised Exchange (CEX). You will need to have a KYC-ed StraitsX account, a local (Singapore) bank account and a self-custodial wallet such as Metamask. The list of bank account supported by StraitsX can be found here.
The process is initiated through a bank transfer using FAST from your bank account to StraitsX. Once the transfer is done from your bank account, a confirmation email will be sent by StraitsX in a relatively short time (within 5 mins?), confirming the successful bank transfer. The SGD you transferred is automatically converted to XSGD token in a 1:1 ratio and credited into your StraitsX account. There is no bank transfer fees charged by StraitsX.
The next step will be to transfer XSGD token to your self-custodial wallet. StraitsX supports the transfer of XSGD on 4 blockchains: Ethereum, Hedera, Polygon and Zilliqa. StraitsX charge a fee to cover network fees for the transfer. For the occasions when I transferred out XSGD through the Polygon network, the fee was 0.01 XSGD each time, equivalent to 0.01 SGD.
Please make sure you have some native token (E.g. MATIC on Polygon) in your self-custodial wallet to pay for gas fees to perform subsequent transactions (such as swaps or transfers).
Once in your self-custodial wallet, it is now up to you to either keep XSGD as a stablecoin or swap to other digital assets. Examples of cost-efficient route I have found or recommended by others:
To ETH (on Polygon)
> Swap XSGD (on Polygon) to ETH using a Decentralised Exchange (DEX) aggregator such as https://swap.defillama.com/. Gas fees for swap typically less than 0.10 USD depending on Polygon traffic.
To BTC (on BTC blockchain)
> Swap XSGD (on Polygon) to USDC or USDT (depending on which USD stablecoin gives favourable price impact at the moment of swap) using a DEX aggregator. Gas fees for swap typically less than 0.10 USD depending on Polygon traffic
> Transfer USDC/USDT to binance.com
> Swap to TUSD with no swap fees (if USDC is transferred in, then you need to swap to USDT for free and then to TUSD)
> Swap TUSD for BTC with no swap fees
> Transfer out BTC to self-custodial wallet on BTC blockchain (withdrawal fee of 0.00005 BTC)
Pro-tip: To minimise spread of swapping XSGD to other tokens (reflected as price impact), try to swap during stock market trading hours (either Singapore trading hours or American trading hours). Spread tends to be smaller during trading hours and larger on weekends and holidays.
And that is how you crypto on-ramp your money into your self-custodial crypto wallet in a cost efficient manner. Do you have another way to on-ramp your money efficiently? Share it with us in the comments. If you have found this useful, consider using my referral links here. For most links, we both get rewards. Win-win!
