Any crypto investor knows that converting crypto to fiat is just as important as converting fiat to crypto. As the market keeps fluctuating, we should understand the value of crypto-to-fiat pairs to make our trading strategies.
For example, we can exchange ETH to EUR to save our gains or spend the yields from our investments. This post discusses the most popular exchange pairs from crypto to fiat, and the factors that influence them.
Top 5 Crypto-to-Fiat Exchange Pairs
First, let’s explore the most traded crypto-to-fiat pairs. They are usually comprised of the most valued and used fiat currencies in our global economy, like the USD or Euro, as well as the most traded cryptocurrencies, like Bitcoin or Ethereum. These are the most liquid and accessible coins currently in the market.
1. USDT → USD
The trade of USDT to USD is among the most popular ones in crypto markets. The US Dollar, on the one hand, plays a central role in the world’s economy and is accepted practically anywhere. It has been adopted as legal tender in various countries and is used as a reserve by others.
USDT, on the other hand, is the stablecoin with the highest daily trading volume. In the last 24 hours, a total of $81.7 billion in USDT was traded. In terms of market capitalization, it ranks third, just below BTC and ETH. USDT’s popularity is due to its stability, as well as its presence across plenty of platforms and blockchains. USDT is available in over 90 sidechains.
2. ETH → EUR
The ETH to EUR pair has also gained relevance recently. The Euro is one of the most popular reserve assets in the world, only surpassed by the US Dollar, and it’s legal tender in 20 countries in the Eurozone. In the last couple of years, European authorities have focused on providing clear regulations for the cryptocurrency ecosystem, and this, in turn, helps foster the development of the industry in the Eurozone.
In that context, it’s important to understand the importance of Ethereum’s ecosystem of DApps, especially DeFi protocols, that attract a lot of investors worldwide. These two factors — the clear regulatory landscape of Europe and the versatility and strength of Ethereum’s ecosystem — lay the ground for the popularity of the ETH to EUR pair.
3. BTC → USD
BTC to USD is also one of the most traded crypto-to-fiat pairs. The central role of the US Dollar in global markets was already covered. In the case of Bitcoin, despite having a lower daily trading volume than USDT, it has wider institutional support and a longer history in the ecosystem. It is, after all, the first cryptocurrency ever created.
In the last couple of years, we’ve seen the emergence of dozens of Bitcoin ETFs in the US, driving the adoption of the cryptocurrency and increasing its presence in the American markets.
4. USDC → GBP
In the United Kingdom, many investors prefer to convert their crypto assets, especially USDC, to the local currency, the British Pound. The advantage of this pair is that it provides more transparency and integration with the local banking system. Moreover, this pair complies with the local financial regulations, since European laws no longer apply in the United Kingdom.
5. BTC → JPY
Another relevant pair in crypto-to-fiat markets is the conversion of BTC to Japanese Yen. Japan has been an important market for Bitcoin since the early days of crypto. For this reason, the Japanese market has had time to mature and consolidate a strong regulatory structure, placing the country as a powerhouse in the Asian crypto industry.
Paired with that, there is a high level of crypto adoption among everyday users in Japan, resulting in a high trading volume in this country.
Factors That Influence Exchange Pair
There are different factors that influence the popularity of crypto-to-fiat pairs. Local regulations, as well as adoption, play a role in the development of these markets. The availability of frictionless off-ramping tools, using which traders can easily convert their assets, is key to privileging one pair or the other.
Liquidity and Market Depth
High liquidity is one of the most significant factors that influence the adoption of an exchange pair. Deeper liquidity in a specific market means faster and more secure transactions, because there are plenty of traders exchanging as well. This ensures better rates and lower slippage, which gives more trust and clarity. Deep liquidity and high trading volume make for more stable and predictable prices.
Fees and Conversion Costs
Another important factor is the cost of fees. Not only the blockchain network fee, but also the fees charged by the exchange, impact the overall cost of making a transaction. A key to reducing the expenses of any conversion is to choose the right crypto-to-fiat pair, with deep liquidity and availability. Use an appropriate trading application with a transparent fee structure and a secure and regulated environment. This way, you can know beforehand how much the transaction is going to cost, and build your investment strategies based on it.
Geographic and Regulatory Availability
The local regulations and availability also play a crucial role. The most popular pairs include top currencies in the global markets or local currencies of countries with a strong crypto ecosystem.
Final Thoughts and FAQ
These are the most important factors to take into account when you need to choose a crypto-to-fiat pair. You need to evaluate your local regulations and also find the most liquid markets in your particular context.
- How to transfer ETH to EUR?
You can transfer ETH to EUR using a regulated off-ramp exchange that is registered in the EU.
- Which pair is best for beginners?
The best pair depends on your local market and the availability of coins. It is best to use your local currency or a currency with deep liquidity in your country.
- Why do fees differ between pairs?
Fees depend on local regulations and market dynamics, as well as the network costs and status at any given moment. For that reason, some pairs may have lower fees.
- Do I need KYC to convert crypto to fiat?
It is necessary to comply with KYC rules on regulated exchanges, which provide more security for traders.
