Should your small business accept crypto? Let’s find out

While there are many pros to using digital assets for everyday payments, there are also some tangible drawbacks one has to consider when dealing with crypto payments. So without any further ado, let’s get straight into it.

The crypto market has showcased a staggering amount of growth recently, as is best made evident by the fact that the total capitalization of this space increased from $1 trillion to $2 trillion between February and April 2021. In this regard, one can see that the amount of institutional money that has been flowing into this space has been incredible, with companies like Tesla, MicroStrategy, Square, Grayscale all incorporating sizeable sums of BTC into their existing portfolios.

That being said, it is still worth looking into the question of whether it makes sense for small business owners to accept crypto? While there are many pros to using digital assets for everyday payments, there are also some tangible drawbacks one has to consider when dealing with crypto payments. So without any further ado, let’s get straight into it.

The future of cross-border transactions — crypto payments are cheaper and faster

For small businesses that supply their goods internationally, crypto can be a gamechanger since it allows users to save on a lot of unnecessary transfer fees. Traditional payment avenues like PayPal and SWIFT often levy heavy processing charges, causing individuals to bear excessive overhead costs. For example, Paypal charges users up to 5% of every transaction as fees. Similarly, SWIFT-based transfers initiated by most banks can cost anywhere between $25-$65 per outing.

On the other blockchain-based payment ecosystems such as Binance Chain (BNC), Tron, ERGO allow for monetary exchanges to take place at fee rates that are almost negligible when compared with their above-stated counterparts. For example, users can facilitate transactions on BNC for less than 10 cents and for free on the Tron network.

If that wasn’t enough, transaction speeds using crypto are on a completely different level when compared to traditional transfer mediums. To put things into perspective, while 

as SWIFT-based transactions take anywhere between 3-5 days to complete, crypto transactions usually take just minutes (if not seconds) to complete.

Monetary diversification

For people who understand the market well, it could be beneficial to take payments not only in established cryptos like Ether, Bitcoin, Bitcoin Cash but also upcoming tokens such as like Cardano, Polkadot, BNB, XRP, etc. This is because these projects stand to grow quite immensely in the long run and could therefore be helpful in delivering massive yields later down the line. 

Hedge against inflation

Since the onset of the global coronavirus pandemic in 2020, the US Federal Reserve has been printing an insane amount of money, continually adding more fiat supply to the financial system. For example, Over the course of the last 12 odd months, the total amount of dollars that have entered circulation have increased by a staggering $3.5 trillion. To put it another way, within a span of six odd months last year, the American government printed 22% of all US dollars currently in circulation.

Similar money printing has taken place all over the globe and has not gone unnoticed by a large section of society who believe that this constant devaluation of their local fiat supply streams can lead to uncontrolled inflation. Thus, for small business owners, it may make sense to accept payments in cryptos like Bitcoin since their total market capitalization is controlled, i.e. only a total of 21 million Bitcoin can ever come into circulation. 

In fact, the premier digital currency is increasingly being viewed by many — by both retail as well as institutional players —  as being a hedge against inflation, something that is best highlighted by the fact that an increasing amount of money has been flowing into this space on a regular basis.

Crypto speaks the language of the young

An increasing number of people, especially those between the ages of 18-34 seem to be quite keen on exploring the crypto realm. In this regard, as per statistical information available online, 37% of Americans claim that they were willing to accept a portion of their compensation in Bitcoin, with the figure being even higher (around 50%) in the UK and Canada.

What this seems to suggest is that there is a whole untapped section of people who may have gained a decent amount of exposure to the crypto market and thus may be interested in spending their money in the form of digital currencies, if given the option. As a result, it can be a useful strategy for small business owners to start accepting cryptos in order to diversify and possibly expand their existing customer pool.

No Chargebacks

A common issue that a whole lot of people are faced with when dealing with credit cards is that of ‘chargebacks’. In its most basic sense, one can think of a chargeback as being a demand made by a credit-card provider to a retailer in order to recover losses on a fraudulent or disputed transaction. For small merchants, this can be a big problem, especially if multiple instances of chargeback fraud occur at the same time.

With Bitcoin and other cryptocurrencies, this is not a possibility since the transfer takes place in a totally P2P (peer-to-peer) fashion, eliminating the need for any third-party intermediary. 

The Flipside

Even though on paper, crypto payments make a lot of sense, there are a few downsides to consider as well. For starters, most major cryptos in existence today are exposed to a lot of volatility. And yes, while one can argue that massive overnight fluctuations have dropped down quite significantly in recent years, it is still quite regular to see Ethereum, Bitcoin being subject to daily 1%-5% price swings.

Lastly, private keys associated with crypto wallets are irrecoverable which is basically a polite way of saying that if a business owner accidentally loses their seed key, they may never be able to recover their digital assets.


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