Today’s global companies tend to accept cryptocurrency payments like Bitcoin and use digital assets to invest, operate and trade. While it is well known that the cryptocurrency market is fraught with risks, this nascent market also has excellent incentives that drive businesses eager to open a Crypto Business Account.
In the article below, we provide detailed information and analysis of why businesses like yours should consider the possibility of entering the cryptocurrency market as soon as possible.
Table of Contents
What is Crypto?
Cryptocurrency is used as a means of payment for transactions on the Internet to exchange, buy and sell goods and services.
Some companies can build and issue their cryptocurrencies and name tokens. These Tokens are identified by name and converted to the corresponding value to buy/sell the goods and services provided by the company that owns the Token.
In a word, Token is similar to going into a Casino. It would help if you exchanged US dollars for the corresponding chips, then used these chips to participate in the games. Similarly, it would help if you exchanged cryptocurrency for Tokens to buy, sell or exchange goods and services available on the system.
Cryptocurrencies work using a technology called Blockchain. Blockchain is a decentralized technology that spans multiple computers to manage and record transactions. Blockchain is called a ledger, cannot replace or delete data, so it has incredibly high transparency and security.
Why consider using crypto?
Until now, there are more than 15,000 businesses accepting cryptocurrency payments globally, of which more than 2,000 are in the US. Crypto and digital assets play an essential role in the business strategy and reach the new generation of customers.
The strength of the cryptocurrency market is high liquidity, quick transaction times, not being controlled or regulated by anyone, and finally, transparency. Those are the reasons why businesses are willing to use cryptocurrencies as a standard payment method.
However, cryptocurrencies still have unknown risks. Business owners need to scrutinize why their business needs to develop a cryptocurrency payment method and prepare thoughtfully.
What can crypto do for your company?
Here are some compelling reasons why your company should use crypto:
Firstly, cryptocurrencies provide an opportunity to reach a new demographic of customers for businesses. This group of customers is often young, modern, tech-savvy, and values transparency in transactions. Studies show that nearly 40% of customers who choose to pay with crypto are new business customers. These customers are willing to spend twice as much as customers who pay by credit card.
- The adoption of electronic payments will accelerate the development of the business to keep up with the flow of the new era. In the future, central banks will likely issue their cryptocurrencies. At that time, your company has a whole electronic payments experience and is ready to enter the market immediately.
- Enterprises can access new sources of capital and liquidity by coding traditional investments or trading new types of assets. Since then, businesses have expanded their business areas and increased profitability.
- Meeting the increasing demand for payment in electronic money not only of customers but also of suppliers. Businesses save time on disbursement and settlement between related parties.
- Electronic money with simple, fast, and safe money transfer operations. Enterprises are actively controlling capital, at the same time opening up investment opportunities in the digital market.
When using cryptocurrencies in your business operations, the thing to consider is whether adding this payment option aligns with your long-term business goals. Factors that need to be objectively evaluated are benefits, potentials, disadvantages, costs, risks, system/technology requirements, etc.
Two primary paths for using crypto
Below is 02 popular methods to enable “crypto payments” for your company:
Enabling payments: “Hands-off.”
Companies that allow users to pay with cryptocurrencies. The company converts the cryptocurrency to fiat currency. So, cryptocurrencies do not appear on the company’s books.
The company still benefits from accepting cryptocurrency payments, such as reaching new customer groups and increasing profits.
If you are interested in this way, you can recommend the company to use the services of third-party providers. The third-party vendor will act as a corporate agent, accepting or making payments in cryptocurrency through conversion to fiat currency. A third-party provider will charge a fee for this service. They are responsible for risk management, compliance with regulations, contracts, and strict control of their assets.
Hands-off is a pretty safe option if your business is not familiar with the cryptocurrency market. This method does not change the existing internal functions of the company.
Enabling payments: “Hands-on.”
The “Hands-on” option applies when your business is ready to enter the cryptocurrency market and has a strategy to expand crypto adoption in its operations and budget. This strategy will significantly increase profits for the business, but it comes with technical issues that need to be resolved first.
The basic questionnaire for business leaders before deciding on “Hands-on” includes:
- What is the purpose of the business when using electronic money?
- To transact, monitor, and manage cryptocurrency payments, what has the corporate finance department prepared?
- Does the finance department support the company’s self-maintenance and monitoring of cryptocurrencies, or is it desirable to hire an external third party to do so?
- What options were given when the company considered the possibility of investing in the cryptocurrency market?
If you are not confident in your business’s ability to manage electronic assets, you should consider hiring a more professional outside third party. A third party will maintain custody of your business’s electronic assets on the Blockchain, managing your Crypto Business Account and Wallet to help you track and value crypto assets.
Self-management of money and electronic assets on Blockchain is a complicated task, requiring someone with long experience in this field.
Identify your company’s path and develop a road map
Suppose a company accepts cryptocurrency payment and has a strategy to participate in the decentralized financial market. In that case, they will need a change in internal thinking, organizational structure, functions, and tasks of the financial department. Therefore, you need to make a specific and detailed conversion plan to avoid unnecessary risks.
In the execution plan, you need to clarify clearly:
- Overall strategy
- Short/long term goals
- The participation and role of stakeholders.
- How the security of the company’s activities is maintained in cyberspace.
- Flexibility and future expansion of the business
- How to implement payment in cryptocurrency, Hands-off or Hands-on.
- How staff needs to add new professional knowledge.
- Implementation roadmap by year/quarter/month.
- Process progress monitoring and quality assessment.
Coming up with an Implementation Plan for the adoption of cryptocurrencies is a complex series of actions. Therefore, your business should choose to experiment with cryptocurrencies like testing a new medicine slowly.
Conclusion
Since people mined the first coins 11 years ago, cryptocurrencies have made significant inroads into people’s lives. The large percentage of global businesses accepting payments in cryptocurrencies shows that this market has much potential for further growth. So don’t miss the opportunity of your business. Learn and invest now! Good luck.
