Capital Properties FX
Capital Properties FX

Accepting Bitcoins as Payment for Your Business: The Pros and Cons


With bitcoin adoption slowly on the rise, more and more businesses are trying to integrate the use of bitcoin into their daily operations. Now more than ever, ordinary people with bitcoin in their bitcoin wallet can surf the web and purchase a good or a service whether it be something extravagant like submarines or wooly mammoth tusks replicas or something as practical as furniture or food delivery.

With that being said, there are still a lot of business owners that are, at best, on the fence about accepting bitcoin as payment. Understandably, there are a lot of things to consider.

If you’re a business owner thinking about accepting bitcoin as payment for your goods or services, here are a few advantages and disadvantages to consider.

Advantages of Accepting Bitcoin

With more and more people starting to understand bitcoin and how it works, the advantages of the digital currency have grown immensely over the years. Aside from the real-use cases that are being discovered with the help of peer-to-peer bitcoin trading, there are a lot of incentives for owners to start accepting bitcoin.

Customer Reach

Bitcoin will allow you to widen the reach of your business. It has no borders and can be sent anywhere and anytime. Over the years, people have discovered that making payments with bitcoin is a good way to save money and time. Instead of going through several intermediaries, bitcoin allows people to send money directly. Bitcoin bypasses all the barriers and intermediaries that normal payments would go through, especially if you’re making a payment abroad.

Accepting bitcoin can expand your reach to a global scale, allowing you to hit more markets.

It’s Cheaper

Not only does accepting bitcoin make payments much easier, but it also makes it cheaper. Since bitcoin bypasses all the barriers and intermediaries, there are fewer transaction fees. If you’re making payments abroad, chances are you’re going to be experiencing many different kinds of fees—most of which goes to a bank or intermediary for their services.

Bitcoin transaction fees will vary depending on the platform or wallet you’re using, but they’re generally much lower than standard transaction fees—in most cases, cents on the dollar.

Security

Bitcoin transactions are some of the most secure transactions in the world. Each transaction is recorded on a public ledger for anyone to see. Identities are obscured, making them somewhat anonymous. Complex hashes prevent all kinds of manipulation on the transaction records and KYC/AML laws are being implemented for even more secure transactions.

Marketing

Accepting bitcoin as payment for your goods and services is a good marketing strategy as well. You could write a press release for it and you can even mark it as a milestone or landmark event for your business. If advertised properly, a whole marketing campaign can be built around it.

It could also brand your business as innovative and forward-thinking—something that would appeal to the ever-growing and ever-passionate bitcoin community.

Disadvantages of Accepting Bitcoin

Despite the stellar advantages of accepting bitcoin as payment, it also comes with its own set of disadvantages.

Volatility

Bitcoin is infamous for its rapid price swings, which could turn a lot of business owners off. Imagine accepting bitcoin when the price is high, but when you have to convert it, the price dips. It will result in a loss on your part. This can get frustrating as your returns won’t be as high as they’re supposed to be.

The quick fix to this is to convert the payments into fiat as soon as possible. If you’re using a peer-to-peer marketplace, you can convert the bitcoin payments into pretty much anything you want—gift cards, bank transfers, cash, and much more.

It’s Complicated

Despite adoption slowly rising, there are still big portions of the world that don’t understand bitcoin and how it works. If you pair that up with already-complex payment processors being used by business owners, it can get a little hectic.

As a business owner, you have to provide instructions or educational material that will inform potential bitcoin customers on how to purchase your goods/services with bitcoin.

Regulatory Uncertainty

Despite bitcoin already being 10 years old, there are still a lot of governments and financial institutions that haven’t figured out how to regulate it. It’s still an infant currency that needs time to mature.

Once regulations are set, business owners will need to adapt quickly or they can face consequences.

Your List of Priorities

With most of the advantages and disadvantages having been displayed, it’s time to really think about accepting bitcoin. Although it could be a good addition to your business, does it really fit in your list of priorities?

Ultimately, it depends on what kind of business you’re running. As a business owner, you need to make sure that everything else is in check before accepting bitcoin. In most cases, the acceptance of bitcoin isn’t a make-or-break decision, which means if you have more urgent and pressing matters, it’s important that you take care of those prior to accepting bitcoin.

If you do decide to be one of those companies that accept bitcoin, make sure that you do your homework. A lot of research is needed to minimize risks and although the possibility of using bitcoin is exciting, rash decisions could end up in losses for you and your business.