Over the past decade, cryptocurrency burst onto the financial scene in a way that almost no one expected, and one of the biggest questions that has emerged is when should small businesses start to accept cryptocurrency as a form of payment? While it still might not be fully understood by many small business owners, it’s likely here to stay.
Cryptocurrency is being adopted quicker than almost any other major change in technology, and businesses are starting to jump on board. Whether or not accepting cryptocurrency payments is the best choice for your unique business is something only you can decide, but educating yourself about the pros and cons will at least ensure that you're making an informed choice.
While it can feel intimidating to explore something that you might not fully understand, there are some incredible potential opportunities that cryptocurrency can offer businesses. If you’re still unsure about the world of crypto, some top experts in the field have some advice about when businesses should begin accepting it, how to accept cryptocurrency cashless payments and why it might be beneficial for the future of your business.
Accepting Crytptocurrency Sooner Rather Than Later Is Ideal
Ron Levy, CEO of The Crypto Company, says that it makes a lot of sense for businesses to begin accepting cryptocurrency — and soon. While it might seem daunting at first, more and more businesses are beginning to accept it as a form of payment, and you don’t want to be behind the curve. As of last year, it was estimated that there are a little over 15,000 companies worldwide and 2,300 businesses in the U.S. that accept Bitcoin.
“You don’t want to lose business to competitors that offer the option before you do,” Levy explains. While it doesn’t mean you should rush into it, there is definitely an advantage to those who will jump on board earlier rather than later. “Cryptocurrency is the next evolution (in digital transactions) and the real-world usage is, and will continue to, grow exponentially,” Levy says.
It’s Worth Taking Time to Understand Cryptocurrency First
As with any major changes or new industries, it’s important that you understand a bit more about cryptocurrency before you adopt it into your business model. “The learning curve can be tough and frustrating for new users,” Keegan Francis, crypto editor at Finder.com, admits. However, taking the time to understand it and establish a business plan around it can pay off in the long term.
“A business may not actually be ready or prepared to accept cryptocurrency until months after they begin figuring out how to incorporate it into their business,” Francis says. However, the sooner you begin the learning process, the sooner you can begin to accept it.
One of the major costs of accepting cryptocurrencies is in the learning and training side of things. “A business will be faced with the cost of training their accountant or employees on how to accept and manage the acceptance of cryptocurrencies,” Francis says. While it’s not looking to replace traditional currencies, it’s simply an added method of payment that your finance team will have to manage.
You may also want to do some research into how to add Blockchain technology, which is the foundation for cryptocurrency, into your business model. Many people are unaware that Blockchain applications can be used in many ways, across many different industries.
Understand the Benefits of Cryptocurrency
Incorporating cryptocurrency into your business model goes far beyond only financial benefits. Look deeper, and it could change the way you lead your company and the way your clients and employees see you. Here are a few key benefits to keep in mind:
Investing in crypto means automatically widening your market reach. Because crypto isn't tied to a national currency, using it opens your network to a more global audience.
Accepting cryptocurrency can establish your brand as a thought leader. Using crypto tends to lead to higher publicity and social exposure for the business. “People will end up spreading the word about your business. The sooner a business starts accepting crypto as payment, the more publicity the business will receive for doing something novel,” Francis says.
There are immediate financial benefits to using crypto, too. Crypto allows you to save as much as 5 percent on transaction fees since trading crypto is free. “Not only that, but Bitcoin enables simple, real-time and secure money transfers and could reduce costs and improve the internal operations of your business,” according to Thompson.
It could position your company as a progressive, future-looking authority in finance. As Thompson points out: “A business should begin accepting Bitcoin as soon as possible. Bitcoin is currently being adopted faster than the internet was in the 1990s.”
As mentioned above, one of the major benefits of accepting cryptocurrencies is the potential expansion of your customer base and reaching an untapped market. If you’re looking to grow your business considerably both internationally and across demographics, then adopting crypto can be one of the best ways to do this.
Cory Klippsten, the CEO of Swan Bitcoin, says that the benefits of accepting Bitcoin or other cryptocurrencies are wide-ranging. “Bitcoin opens your business up to international customers given its global nature,” he says. It makes cross-border payments easier, with lower fees, faster processing times and inherently fraud-proof payments.
It can also make your business appeal to a wider range of demographics and niche customers. “By accepting Bitcoin, your business brand will improve amongst younger demographics…it sends a clear statement that your business is on the cutting-edge,” Klippsten says. For anyone trying to expand their business’ potential customer base, accepting cryptocurrency may just be the way to do it.
Always Account for Some of the Crypto Risks
Shaun Heng, VP of Growth and Operations at CoinMarketCap, cautions that there are both strong risks and benefits to adopting crypto. While the benefits are certainly profound, there are still some nuances and risks that all businesses will need to account for.
“The entire industry has grown organically to date, and coupled with a general lack of regulation, that means there is a volatility in the crypto market,” Heng explains. While taking the time to understand the industry and how it works may put to bed some of your concerns about adopting crypto, you should also take into account the volatility and unregulated nature of it.
Thompson agrees and explains that “the price of Bitcoin remains volatile today, but this has been steadily decreasing in recent years. Given all the benefits of adopting Bitcoin, the pros well outweigh the cons.”
As with any new major shift, you should try and balance the exciting opportunities of it and the inherent risks for your own business. Exploring crypto's possibilities can expand your client base and grow your revenue, but be sure to manage the risks responsibly.
Jenna Scatena is a writer and content strategist with a love for stories that have never been told before. More than a decade of working with prominent magazines and brands informs her approach to impactful storytelling. Her stories have reached more than 30 million readers, won multiple awards and been anthologized in books. Jenna's work has appeared in Conde Nast Traveler, Vogue, Marie Claire, The San Francisco, BBC and The Atlantic. She's the founder of the editorial consultancy, Lede Studio.