The payment options you accept in your physical or online store can be important in convincing your potential customers to transact with you. If a customer can't find their preferred payment option in your store's list of accepted payments, they may not complete their purchase and look for a business that matches their preferences.
Such a loss of business can be devastating to an institution trying to prepare for success in the digital age. As such, businesses should carefully consider whether or not they accept payments in the form of cryptocurrencies. Cryptocurrency users have increased in number in recent years, as has the variety of cryptocurrencies they adopt.
Would it be a good idea to add this method of exchange to the list of payment methods accepted by your establishment? In most cases, the answer is yes – especially if you are eager to enjoy the following benefits and ready to deal with the complications that come with them.
1. The pros and cons of cryptocurrency transactions
Having a Bitcoin, Ethereum or Moreno wallet to receive cryptocurrency payments from your customers can give you the following advantages:
2. Access more customers
Once you start accepting cryptocurrencies in your digital or physical store, you make it easier for tech-savvy customers to purchase your products or services. Your market will not be limited to people who pay with cash or credit, as it will also include a portion of people who have invested in cryptocurrencies in recent years.
You will also be able to accept payment from anyone and anywhere, as you can keep your end of the bargain by delivering your goods or providing your services to the location specified by the customer.
3. Ability to provide a better customer experience
Privacy is increasingly scarce these days, and many customers would like to use their assets without compromising their data or being subjected to scrutiny. By using cryptocurrencies, your business meets their needs without risking their personal data. The same can be said for your business, as the protection offered by cryptocurrency transactions goes both ways.
4. Conduct business with lower transaction fees
One of the main attractions of accepting cryptocurrencies is the lack of a central system to regulate the flow of coins and tokens. This allows individuals and organizations transacting in cryptocurrencies to choose an intermediary who can offer them the most favorable transaction fees.
Instead of paying 2-4% of each transaction to a credit card company or middleman, a business can reduce this cost or even eliminate it altogether. Additionally, there is no need to wait for payments to clear foreign banks when transacting cryptocurrencies, even if the person paying you is based in another country.
At the same time, accepting cryptocurrencies also opens your establishment to the following risks:
5. High level of price volatility
It is a well-known fact that cryptocurrencies are quite volatile. The price of the coin you are using, BTC, ETH, or XMR, can change dramatically in a day. This, in turn, will affect how you translate the value of your assets into cryptocurrencies and include them in your financial records.
You need to be able to quickly and regularly exchange the cryptocurrencies in your wallet for digital or physical money to protect your business from the drastic changes that the cryptocurrency market often experiences.
6. Technical obstacles and maintenance
Cryptocurrencies are still developing and will continue to evolve based on the communities that support them. It is essential to become familiar with the current technologies behind this asset.
However, you should also keep an eye on upcoming developments that may impact the currency you support and the community that supports it. You must prepare for the changes that this asset will continue to undergo if you want to use it effectively for your business.
7. Regulatory uncertainties
Cryptocurrencies offer a fairly new mode of trading, as the first cryptocurrency was only launched in 2009. Laws can be quite slow to keep up with the technology, and digital coins and tokens can sometimes exist in regulatory limbo.
This may mean that, in many places, people and organizations using cryptocurrencies cannot expect the same level of protection afforded to consumers using more traditional means of commerce and exchange, such as fiat currency and credit cards. It can also be difficult to determine how cryptocurrency assets should be reported in regulatory forms and reports.
There are many benefits when catering to customers who want to conduct their business using digital coins. Accepting cryptocurrency payments now can boost your institution's reputation with progressive-minded customers who see the role cryptocurrencies and tokens will play in the future.
Additionally, being part of the cryptocurrency community from the beginning will allow your business to easily adapt to future technologies that may develop from such a dynamic environment.
However, it's important to ask yourself whether your business is prepared for the potential complications that come with taking this route. Only by being fully aware of these risks and possibilities can you maximize the opportunities that cryptocurrencies present for your institution.