Cryptocurrencies are the new wave of technology that is quickly changing the way we live and do business. Many people don’t know how to incorporate cryptocurrencies into their businesses, but this blog post will teach you how to adopt and incorporate this game-changing technology into your business.
More and more businesses accept cryptocurrencies, including Dell, Microsoft and PayPal. These are big companies which are preparing for the future by adopting new technologies in order to be ready when these technologies go mainstream. In this article we will try to cover how cryptocurrencies can be used for business purposes and how you can get started with them.
Before we move on, let’s see some quick facts about cryptocurrencies:
- The first public record of cryptocurrency is a white paper by Satoshi Nakamoto in 2008
- There are thousands of cryptocurrencies today, with Bitcoin being the most popular and valuable one
- Cryptocurrency is an encrypted digital asset that includes blockchain and encryption technology.
- Transactions recorded with cryptocurrencies are organized in blocks of transaction before they can be added to the next link in their chain.
- To possess, send or receive cryptocurrencies, one needs wallets such as hot and cold wallets. Hot wallets are a feature of online cryptocurrency exchanges. Cold bitcoin wallets are all such devices that aren’t connected to the internet– it can be a hard disk drive with USD on it or even an external hard drive.
Here are the 3 more common ways to use cryptocurrencies into your business:
- You can accept cryptocurrencies for goods or services you provide in exchange for traditional currencies through an online cryptocurrency broker service provider like Bitpay.
- You can make payments using a Bitcoin merchant account with the help of some payment processor such as Coinbase.
- Investing is another way to use cryptocurrencies in your business by buying tokens from blockchain startups during Initial Coin Offerings (ICOs). Many successful investors have made millions from investing early on projects like Ethereum, Bitcoin, Ripple etc.
Benefits of Using Cryptocurrency for Business Purposes:
- Transactions are way faster than traditional bank transactions, so there is less waiting around before receiving funds. This also allows businesses the ability to do more types of international trading since cryptocurrencies aren’t restrained by borders like money transfers would be with banks
- Crypto Transactions are way cheaper than traditional bank transactions
- Transactions cannot be reversed like credit card chargebacks or checks that “bounce” (unable to cover)
- Decentralized, not controlled by anyone government or company – so no fraud or malicious activity allowed on the network. There is no need for a third party like PayPal because there is nothing tangible being sent back and forth.
- There are no limits on transactions – unlike a physical bank that might have daily/monthly caps on how much you can withdraw from your account at one time.
- Access to a broader audience – Some people nowadays choose to use cryptos as their preferred payment method. Accepting cryptos will allow you to access this audience.
Drawbacks of Using Cryptocurrency in your business:
- You can’t easily accept cryptocurrencies as payment in your business. You will need to have the technical knowledge or hire someone that does in order to set up things for you such as integrating with your website, connecting with your wallet etc.
- There’s also no clear regulatory framework on how cryptocurrencies should be taxed by governments. If someone pays for your service using Bitcoin and they’re not paying taxes on their earnings from crypto mining, then that could lead to some problems indeed!
- The biggest issue is volatility – which makes it difficult to budget because prices change so frequently.
How to get started with Crypto for Business purposes
Create a cryptocurrency wallet for your business
This first step is crucial if you want to use cryptocurrencies in your business. A cryptocurrency wallet allows you to store, send, and receive currency. There are many different types of wallets so make sure that you choose one that meets all of your needs as well as has a good reputation for security features!
Some common types of cryptocurrency wallets are:
- Crypto Exchanges: You can trade cryptocurrencies on these websites, but they are not usually designed to hold your funds.
- Web Wallets: These allow you to store cryptocurrencies online and access them anywhere with an internet connection.
- Desktop Wallets: This is software installed on a computer that typically requires some form of encryption in order to keep private keys safe from prying eyes.
- Mobile wallets: Mobile wallets functions just like a mobile app and can be used on the go.
- Hardware Wallets: Hardware wallets are typically more expensive but offer some of the best security features such as two-factor authentication, which is an extra way to keep your accounts safe by asking for something you have in addition to what you know (i.e., your password).
For business purposes, we always suggest that one chooses to use hardware wallets because hardware wallets are more secure than other types of wallets, and hardware wallets cannot be hacked.
In order to be able to accept Bitcoins or any other currency as a payment method for your business, you may need to use a 3rd party payment facilitator. A payment facilitator allows you to accept payments in Cryptocurrency and store them in your wallet.
These six companies can help you accept cryptocurrency payments.
- CoinBase Commerce
Planning for the future
As the Crypto Market grows, things are expected to change a lot. One of the estimated changes is that it will become easier to use cryptocurrencies in business. As Crypto usage becomes more mainstream, the need for businesses to switch over will also grow.
Cryptocurrencies will likely also be regulated at some point in the future, which will lead to even more adoption of the technology by businesses.
We hope that our article helped you start researching ways that you can adapt your business and bulletproof it for the future!