Cryptocurrency became more of a mainstream payment system as soon as Bitcoin hit $20,000 per coin last fall, which sparked interest in blockchain technologies. This eventually led to businesses opting to accept cryptocurrency for payments.
But the question is, should small businesses begin accepting cryptocurrency payments? To answer this question, one would first need to consider several different aspects. There are several things a small business would need to know before deciding whether they’ll begin to accept cryptocurrency as payment.
What Do Small Businesses Need To Know About Cryptocurrency?
Before a business, big or small, decide that they’ll begin accepting cryptocurrency, they will need to look at the benefits versus the risks. This form of payment is not for everyone. If the risks outweigh the benefits for your circumstance, it’s highly suggested that you opt-out.
Benefits Of Accepting Cryptocurrency For Small Businesses
When a business begins to accept cryptocurrency, there are several benefits they can expect to experience, such as:
- Becoming a consumer preference. Accepting cryptocurrency gives your customers another way to pay for goods or services. Not only that but there’s an additional level of security for them as well.
- Low transaction fees. Businesses that accept cards typically charge about 25 cents for each swipe of the card on top of 2 to 4 percent of that particular total. With cryptocurrency, you see a far less charge for transaction fees.
- Protection for the merchant. Crypto protects against fraudulent chargebacks. It’s almost like cash transactions where all purchases are absolute and final.
- Sales increase. Accepting crypto opens the doors to many different options, such as selling to other countries, which will increase the number of sales.
Risks Associated With Accepting Cryptocurrency For Small Businesses
Where there are benefits, you can expect risks. The risks surrounding accepting cryptocurrency as a form of payment include:
- You may experience technical barriers. When it comes to cryptocurrency, you also have to familiarize yourself with the digital wallet scene, which is not always an option for everyone, especially those who are not technically savvy. You will need to go through a high learning curve before fully understanding crypto and the foundation that surrounds it.
- It’s not 100% safe. Cryptocurrency is still safer than other forms of internet-based transactions, but that still doesn’t’ mean that it’s 100% secure. You can’t completely prevent any criminal familiar with hacking and things of that sort from stealing your digital wallet. However, nothing is guaranteed in life, so ensure you take proper precautions.
- Uncertainty regarding regulation. The regulatory landscape is currently changing since cryptocurrency is new compared to money and other forms of payment such as PayPal. As they adapt, the business owner will need to adjust with them until lawmakers can set the standard surrounding cryptocurrency. This can be great or devastating for a business, depending on the regulations and what happens.
Is Accepting Cryptocurrency Right For Your Small Business?
Accepting cryptocurrency as a form of payment is not for everyone. If your business is not adaptable or flexible as far as the payment stipulations go, then cryptocurrency may not be for you. On the other hand, if you have plenty of flexibility with your payments and knowledge surrounding technology, it may be more beneficial than risky.
