This is a guest post by Alex M. Alex has been very deep in the cryptocurrency space for the last 3 years soaking in everything there is to know. Alex is constantly sharing about the latest news and updates in cryptocurrencies on CoinPupil. To learn more about him and his work, read here.
Cryptocurrencies have been recently making all the buzz and it has all the right too. A lot of different cryptos are hitting an all-time high with some healthy corrections on the way. Many people only know of Bitcoin but your business can definitely grow by allowing different payment methods.
What are Cryptocurrencies?
Before we begin with how this new digital currency can help a small business owner like you, we need to first explain what it is for the ones that don’t know. In 2008, Satoshi Nakamoto decided to create Bitcoin, a decentralized peer to peer payment network to help combat the malicious acts that big banks and corporations were doing.
It was created in direct relation to the financial crisis. In 2009, it was released to the public. Unlike fiat currency, Bitcoin has a total circulation supply of 21 million coins. No more can be created and that’s what makes it so unique.
Ever since then, more alternate coins were created to help support the whole ecosystem. Since the price has gone up so high, it is being noted as more of a store of value than an everyday currency so Litecoin was introduced. Litecoin can be used to purchase your daily coffee or other everyday items.
Different from every other form of payment, cryptocurrencies are intangible which is why a lot of people don’t believe in it. Unlike cash, you can’t touch it, hold it or smell it, which is what gives it a sense of realness.
Bitcoin is decentralized and completely controlled by you which means you are your own bank. You do not have to worry about going to the bank to withdraw money. You are completely in control of it through a digital wallet. It is either stored in a specific hardware, your computer, your phone or on paper. This wallet contains a set of cryptographic hash address.
Many people often call these virtual currencies when in reality, they are digital currency. The difference between the two is that digital currencies are money in the digital form and virtual currency is usually inside a game. For example, you can purchase tokens with real money on different video games and use those tokens to buy stuff in the game.
Why small business need it
The mentality right now is that most people don’t own any cryptos so the amount of purchases with it will be very small. Even though that is true, you can be missing out on some serious volume of orders. While you may not realize it, people are starting to live completely on only Bitcoin to prove a point.
This means the demand is there for so many businesses in different sectors should accept it. This mentality is hindering mass adoption but lately, the market has been proving that more people are getting into it.
It took the whole market 8 years to reach a $200 billion market cap. Yet it only took 24 days in November of 2017 to go from $200 billion to a $300 billion market cap. This means more people are being introduced to the idea and they love it. Google trends is even showing an all-time high of people searching for Bitcoin or related terms.
In case you think that doesn’t mean anything to you, remember that millennials are more open to owning Bitcoin than owning stocks. There is a reason big coporations like MicroSoft, OverStock, Virgin Galactic, Lamborghini, Square, Shopify and much more have started implementing it into their business.
Security is another factor and Bitcoin possesses very enhanced security. Your customer’s information is more safe if they use crypto than a credit card. We are having so many data breaches all over.
Millions of people are losing their personal information like social security and credit card numbers. Bitcoin is also a pseudonymous technology. It means people can see how much money is in the wallet of a specific address, but no one can know whose wallet that is.
How It Benefits the Business Owner
Freedom: As mentioned above, cryptocurrencies are generally meant to be decentralized so you have more control of your money. If I want to purchase something, I can directly transfer from my money in my wallet to the seller without any third party being involved.
There are many people that have had their PayPal account frozen with thousands of dollars even though they did not violate any terms of services. PayPal has the legal right to freeze funds since it is their platform.
No Fees for the Seller: When your customer pays with a debit or credit card, your payment processor will take anywhere from 2.9% to even 9% of fees depending on your business and history. With cryptocurrencies, you never have to worry about this. All transaction fees are paid by buyers. Even then, the fee can be a fraction of a penny for them.
No chargebacks: One thing business owners love about cryptocurrencies is that there is no chargeback feature. No worries about getting their product. Or calling their credit card companies to lie to them about not receiving the products. Many sellers are getting this claim and if you’re an eBay seller, you know it all too well.
Digital Payments: Everything is done digitally so no worries about counting cash or anything. The buyer can simply use the app you use for your wallet and scan the QR code set up by the seller. This will take the correct amount of coins that the QR code was set up for. It will transfer it from the buyer to the seller right away. As long as you have your phone with you then you can pay.
How It Benefits the Business:
Ecommerce – Many ecommerce owners started accepting Bitcoins starting from 2010 when it was hadn’t even reached a single dollar. They really believed and liked the idea. They would get paid thousands of bitcoins per item since the price was low yet it has appreciated hundreds of thousands of percent.
Bitcoin is on the rise but even more so, it is another different method of payment that you can offer your customers. Some people truly want to start spending bitcoins only. Better yet, offer a small discount for all cryptocurrency spenders on your website.
No International Rates – Another great feature about cryptos that don’t get talked about so much is that there is no international fee. If someone in another country wants to pay you, there won’t be additional international charges.
Instant Money into Your Wallet – Like we said, your wallet is your bank. There no need to wait 3 days until money is transferred to your bank account from credit card processor.
Crypto to Cash Same Day – Once your money goes into your wallet, you can go to any Bitcoin ATM and cash out. You send your money into the machine and it dispenses cash. Find out the fee of each ATM before you use it.
More Market Share – Since more people are moving to pay with only crypto’s, they’re going to look for places that accept them. You can add yourself to more cryptocurrency directories so there are more eye balls on your website.
Eliminate the middlemen – Using the blockchain, the blockchain can eventually eliminate lawyers, notaries, brokers and more. Getting used to the technology now, you can eventually be one of the first ones to lead it. It can help your business expenses.
How to Accept Cryptocurrencies
Accepting cryptocurrencies is not difficult at all. Just download the plugin of the processor pluigin, enter your cryptos hash address and start accepting them. As far as accepting them, you can go two main routes.
Either in person by just showing a QR code and having it scanned or by giving the hash address so someone can send the payment to that address. The second way is signing up with a crypto processor and offering multiple different coins.
There are also Visa debit cards that take the money directly from your wallet. They allow you to pay with cryptocurrencies at any location that accepts Visa. TenX and Monaco are the two coins that gives you the ability to do this.
- CoinPayments – Coinpayments is a payment processor for cryptocurrencies and has the most available coins. It is very easy to use and it’s a free plugin to download. It supports such platforms as wordpress, Shopify and Magento.
- Bitpay – Bitpay is another payment processor. They are more well-known but only offer a few different coins. BitPays charged on a tier level so it charges different the more you sell.
- CoinKite – If you’re a brick and mortar business then accepting payment can be as easy as doing it through the phone to each other or by having a CoinKite terminal. It prints off a QR code for customers to scan and send money. It also acts as an ATM.
We hope that you gained valuable insights in the world of cryptocurrency. Thank you for reading and see you again on the platform.
Latest posts by Daniela Cherkova (see all)
- Best Dropshipping Products – Our top 5 - June 29, 2018
- How To Address Cash Flow Issues In An eCommerce Business - June 21, 2018
- 6 Signs Your Company Needs New Inventory Management Software - June 20, 2018