If you’re a business owner, then you’ll already know the importance of user experience on your website, particularly when making a sale. Ideally, you want it to be as easy as possible for customers to checkout and make a purchase, preferably with a selection of different payment options.
One thing that is increasing in popularity within business is the acceptance of cryptocurrency as a payment method. However, wild price fluctuations occur almost daily, and this form of currency has been around for 10 years, it’s only just making its way into the mainstream as a result. With recent data, it is predicted that around 30% of businesses in the US, where cryptocurrency is more widely accepted, accept it as a form of payment.
With it being a trading market that is open 24 hours a day, 7 days a week, with no exchange rate or conversion, many businesses are wondering whether or not they should be accepting cryptocurrency as a payment method. There are several considerations that you should take into consideration when looking into whether or not your business should accept cryptocurrency, so let’s take a closer look.
How Do Cryptocurrency Payments Work?
Cryptocurrencies work using a technology called blockchain, which helps to keep transactions secure. Customers can buy cryptocurrencies using the currency of their choice and then keep this currency in a designated location, known as a wallet.
When customers use cryptocurrency to make a purchase, this is then taken out of their wallet. If you offer cryptocurrency as a payment method on your site, then there are bitcoin payment services that convert this into the currency of your choice. Then, the money is transferred to your usual business banking account.
Benefits Of Cryptocurrency
More and more businesses are choosing to use cryptocurrency, including big business names such as Tesla and Microsoft. PayPal has, in some countries, even started to accept Bitcoin alongside its usual payment options.
Lower Transaction Fees
Compared to credit cards, there are fewer fees associated with accepting cryptocurrency payments.
Better Security
Because cryptocurrency is decentralized, there is better protection against fraud and there aren’t any third parties that can cancel your online payments. Blockchain stops customers who don’t have the funds to make a payment but reduces the chances of business chargebacks.
International Trading
One of the biggest benefits when using cryptocurrency as a business payment option is that it easily opens doors to new, international markets. You can easily make or take payments from buyers living in any country around the world. This can help boost your business revenue and encourage growth.
Risks of Using Cryptocurrency
Whilst there are some benefits to using cryptocurrencies, there are also some risks that you should be considering with this relatively new form of technology.
Asking Customers To Use New Technologies
A lot of customers still like the old-school approach to shopping online and, by introducing cryptocurrency payments, you could put some customers off shopping with you as it requires some understanding of this new technology.
Risk of Scams
As the cryptocurrency market is highly unregulated, this also means that scams and hacks are fairly common. FOREX scams, crypto, and bitcoin scams are ever-evolving and becoming more complex. By accepting cryptocurrency within your business, you’re increasing the risk of falling victim to a scam and losing money.
Conclusion
Whilst novelty and volatility are both parts of what makes cryptocurrency so exciting to traders and investors, it can be off-putting for businesses. It’s important that, if you do consider accepting cryptocurrency as part of your business model, you reduce the risk by doing thorough research. It’s also important to realize that cryptocurrency regulation is changing rapidly, so there is the expectation that merchant and business protection will be implemented over time.