Cryptocurrency markets are receiving thousands of new investors every day. It is easy to see that the crypto scene is booming. Businesses need to make the most of this opportunity. They can do so not just by investing in crypto but by starting to accept payments in crypto too.
Here is why they should do so.
Increased Consumer Access
Numerous businesses have already begun accepting cryptocurrencies as a form of payment. For example, DPD, a UK-based delivery company, accepts bitcoin for its shipping services. Like DPD, several other global companies use cryptocurrencies for their payment offerings.
As more consumers begin to access the cryptocurrency market and use cryptocurrencies as a means of paying for goods and services across various industries, the barriers to entry are rapidly falling away. The exponential increase in cryptocurrency usage will ultimately lead to more widespread adoption; as with any new technology, it’s only a matter of time before cryptos become commonplace in society.
Many people associate cryptocurrencies with the dark, underground underbelly of the internet. However, this is a misconception. Cryptocurrencies are useful tools for businesses and consumers alike.
Cryptocurrencies are ideal payment methods for businesses because they are not as susceptible to theft. For example, when you pay with your credit card at an online retailer, a third party—in this case, PayPal—must first process and verify your transaction before it goes through to the merchant’s account.
Hackers who break into PayPal’s or other payment processor’s networks can then capture all of the information about your purchase. They can use that information to make fraudulent purchases on your behalf, and even worse, those fraudulent purchases can’t be reversed because they occurred after you initiated the original purchase.
With cryptocurrency, however, there are no intermediaries like PayPal or credit cards. You need only the cryptocurrency exchange where you’re trading in bitcoin or another cryptocurrency. So even if someone hacks a host of exchanges simultaneously, they would have nothing but “virtual” currency to trade with for their transactions to go through without any oversight from outside parties such as PayPal (or credit card processors).
Cryptocurrency isn’t just useful for paying for things online; it also has applications in person-to-person transactions between friends and neighbors and companies within an industry or community (such as managing online forums). These applications will continue to expand as blockchain technology continues its development and becomes more widely adopted by merchants and consumers alike.
Cryptocurrency prices vary greatly and can be considered volatile sometimes. However, crypto payments usually have lower fees compared to credit card payments. That allows you to save costs on payment processing fees.
Payment system fees are expensive. With credit cards, you can end up paying a lot in transaction fees that don’t even go toward the merchant’s cost of accepting credit cards. In comparison, cryptocurrency payments generally have lower fees than credit card payments.
The most obvious example is Bitcoin, which has no network transaction fee and charges merchants 0% or low flat-rate fees for issuing the invoice (what comes out of the credit card machine). Even if you’re using another cryptocurrency for small purchases, you’ll still typically see savings compared to just paying with cash or a credit card.
Exchange rate fees can be tough on exchange rate traders, who use precious resources to continually buy and sell at favorable rates to make money—you probably don’t want to be one of those traders! However, as long as your local currency is backed by a major central bank with fiat reserves (USD is backed by the US government), it doesn’t matter what other currencies you’re trading.
Avoid getting into trading cryptocurrencies unless you have ample knowledge on how they work and how they’re valued over fiat currencies.
After all, the first rule of business is to be visible. If you have a brick-and-mortar store, that means having a storefront location with a professional sign and friendly décor. If you’re an online retailer, you want to make sure your branding comes through on your page—from the fonts and colors used in your logo and banner images to the presentation of your products in the photos you use to sell them. Furthermore, having a website can help increase your credibility as a company by making it seem like you’ve invested resources into being an organized and successful enterprise.
All of this is necessary for building trust between yourself and potential customers—the most valuable asset in any business venture—and cryptocurrency can add another layer of exposure that’s easily accessible by nearly anyone with internet access.
In today’s digital world, people are constantly connected to their phones; many spend half their day staring at screens with apps open on them (if not more!). That means that if you have a cryptocurrency wallet application available for download on mobile or desktop platforms, you’re reaching not only those who already support cryptocurrency but also those who might be interested in checking out what it has to offer others.
It might not seem like much from one customer paying for one item with bitcoins or ethers every once in a while, but every bit counts when it comes to increasing brand loyalty for businesses built around new technology like cryptocurrency.
In the world of cryptocurrency, taxes can be a bit confusing. Many people are unsure about how and where to report crypto transactions for tax purposes. That is because cryptocurrencies are new. Many governments haven’t yet figured out how to classify them. The most common conclusion that governments have reached regarding cryptocurrencies is a simple one – they need to be taxed.
Cryptocurrencies operate similarly to other currencies, but they can also vary depending on the type of currency being used. For example, bitcoin is not taxed as a capital gain; it’s taxed as an income. And other types of cryptocurrency are not taxed as currency; they’re taxed as commodities or even services.
If you’re considering investing in cryptocurrency and would like advice about taxes or reporting requirements for your particular country, talk with a professional who has experience in this field before making any investment decisions. They can help you determine if the benefits outweigh any potential trouble later on down the road when it comes time to pay your taxes.
Based on these points, it is evident why more businesses should embrace crypto as a payment option.