It’s believed that cryptocurrency has taken the world by storm. What was once a niche hobby to some has now become a multi-billion-dollar industry in less than a decade or so.
Cryptocurrency In The Retail Industry Today
With the massive growth it has enjoyed throughout the years, though, you’d expect to see some advancements-and they’ve certainly come about in every aspect of cryptocurrency or crypto from mining to exchange markets. One area that still hasn’t been entirely adopting it? The retail fronts. While it’s not uncommon to see some major stores and even some small businesses making the jump into the world of crypto, there are still many people out there who are hesitant to make the switch.
For some, they believe that it’s just not good enough to use crypto for online transactions. It’s said that many people with crypto wallets would love to purchase products and services using their crypto stash. However, even though there are banks accepting cryptocurrency already, people are still forced to convert it back into fiat currency because not every merchant is accepting it yet in their business’ financial dealings.
If you’re a store owner or a person looking to start their own company, you may be wondering if you should start accepting cryptocurrency as a form of payment? This article will discuss with you the different aspects involved. Read on to learn more.
Advantages Of Allowing Crypto As Payment
Identifying the risks and the benefits is the first step when making the decision to whether adopt crypto as a form of payment for your business transactions. There are numerous benefits to accepting cryptocurrency as a form of payment, some still see its risk outweighing the benefits it can bring. Some of the benefits include:
- Help Attract New Customers That Own Cryptocurrency
Cryptocurrency isn’t just a trend. The market is said to have grown massively and many believe that it’s only looking to continue growing even more in the future because of its widespread usage. This potentially means that people who are just getting starting with crypto have only started buying them to join in the craze. And what they want is to be able to spend them. If you’re a store owner who doesn’t accept cryptocurrency as payment, these potential customers won’t come to your store.
Think about clients who prefer to use debit and credit cards for their finances. If you don’t accept their means of payment, they won’t bother to transact with you. They’ll go to your competitor’s store that accepts their preferred payment method. The same thing with cryptocurrency users. If you want to serve all customers, then accepting all forms of payments, including cryptocurrency, might be a great idea.
- Easily Tap Into The International Market
If you plan on expanding your business, then accepting cryptocurrency is the way to go. Since people can use crypto almost anywhere in the world, it means that if you take it as a form of payment, you’ll be able to reach customers residing in any country in the world. Accepting crypto will also eliminate cross-border transaction costs that patrons may find enticing.
- Fewer Incidents Of Chargebacks And Fraud
It’s said that there are many cases of fraud and chargeback issues with credit cards and debit cards. Why? It’s because most card-based transactions don’t go through immediately as crypto transactions do. There’s greater wiggle room for error present with using fiat currency and that’s something you’ll be able to avoid when using cryptocurrency as a form of payment. Blockchain technology assists the prevention of fraud and chargeback issues as there’s no third party that can interfere with the transaction process.
- Faster Payment Processing
Cryptocurrency payments are said to be processed much faster than fiat transactions. Instead of waiting hours or days to confirm your ownership of the funds, most crypto transactions are done in an instant. Once verified, it’s a done deal.
- Early Adaptor Advantage
As the cryptocurrency market is still green, there aren’t many merchants that accept or deal with it yet. Some analysts believe that crypto will be on par or even more prominent than a fiat currency in a few years. If you want to get your business ahead of its competitors and be an early adopter of the financial medium, then accepting cryptocurrency as part of your mode of payment is something you should consider.
Possible Drawbacks Of Accepting Cryptocurrency As Payment
As promising as it may seem, there are still some risks that you as a merchant should consider when dealing with clients using crypto. May it be for payments and the like, the perceived risks and disadvantages of accepting cryptocurrency include:
- Unregulated Market Poses High Risks To Businesses
Many experts believe that cryptocurrency is still in its infancy stage and that the market is unpredictable. Since crypto is decentralized, this makes it harder to regulate. Due to the lack of a sole central regulatory body for crypto transactions and dealings, using crypto for a business’ financial transactions may be highly risky.
- More Difficult To Keep Tabs Of Crypto Payments
It could be hard to analyze transactions made using cryptocurrency. If several people are paying in different currencies into one account, it can get confusing especially for merchants who don’t understand how it works. This can result in merchants using inaccurate figures and lose track of important financial information important for accounting and bookkeeping purposes.
- Value Volatility May Lead To Losses
Cryptocurrencies are said to be too volatile. Prices adjust so much that their value could drop or surge without prior warning. They can result in either extreme losses or profits for the merchant.
- Less Trust Because Of Lack Of Regulation
Unlike fiat currency, cryptocurrency is still independent of any form of government or central banking control for most countries. There are no laws or regulations that can force crypto wallet providers to be responsible if merchants lose access or experience issues with their crypto wallets.
- Crypto Can Be Confusing For Others
Learning the ins and outs of how cryptocurrency how works might be hard for some people to understand. This can cause a customer to create a negative perception of you as a business in general. Not many people know how it works and those unfamiliar with it could be intimidated by the process.
Cryptocurrency And The Future Of Payment Transactions
There’s no doubt that cryptocurrency is a promising technology that could change the future of transactions for many crypto investors. They believe that it’s just the beginning and there will be more opportunities for this form of payment to grow in the coming years. But before you can accept cryptocurrency as a form of payment for your business, it’s best to understand how it works and what risks are involved with doing business using unregulated virtual currencies.
Should you accept it as a form of payment? The answer merely depends on your level of understanding of how it works, the risk associated with it, and your existing business model. If you’re willing to take the risk and believe that cryptocurrency will be beneficial for your company, then it could still be a good idea to accept it as a form of payment.
However, if you’re still in doubt or have reservations about it, there’s no pressure to immediately jump into the crypto hype. For now, you may keep yourself updated with new developments on the technology and see how it possibly could benefit your venture.
Laura Distel is an adventurer, writer, and cryptocurrency enthusiast. She loves to explore new places by bike or trekking through the wilderness with a pack on her back. Laura has been into cryptocurrency for six years now and is excited about where it’s taking the world.