Accepting Cryptocurrency in Business
Just how easy it is to add cryptocurrency to your payment options?
The answer to this—one of the most frequently asked questions of current crypto conversations—is ‘it’s easier than you’d think’.
Still as confusing as ever to many, terms like ‘Bitcoin’ and ‘Cryptocurrency’ are regularly creeping into our daily conversations and our lives. They’re growing as fast as many of the tech-novelties-cum-everyday-utilities do, so just how long will it be before they integrate into our natural spending habits as credit and debit cards, contactless payments, and PayPal did?
The currency that brought crypto into the public domain, Bitcoin, coined an immediate catch-all phrase for the new digital finance system (pun well and truly intended) and is still the most popular in the crypto world.
Advantages of accepting cryptocurrency
More businesses are accepting crypto as a means of expanding their global reach, taking advantage of lower fees, and favouring a more secure and direct payment technology, all while building brand appeal.
Increases geographical reach
Cryptocurrency allows direct payments between parties without the complications of location, bank transfers, and confusion around exchange rates.
Super secure transactions using blockchain technology
Blockchain, a type of shared database technology, is why we have cryptocurrency, and it’s an incredibly secure system. Crypto is more efficient and accurate than the traditional banks’ centralised systems, offering safer services protecting data and currency.
Lower processing fees
Fees for processing your usual card payment transactions are usually between 1.5 and 3.5%, whereas crypto rarely tops 1%. Shop around, and you’ll find crypto processors that charge as little as 0.5%. If all of your payments were paid using cryptocurrency, how much would that save you over the year?
Your brand strength grows, as will confidence in your company
Apart from the financial and practical advantages, why do you think the biggest tech players around the globe were amongst the first to announce they were going crypto? Marketing is massive in building brand confidence, so if you show yourself to be a cutting-edge, tech-savvy, forward-thinking and acting business, you’ll pique interest and gain the faith of both existing and potential new customers.
Factors that merchants should consider before embracing cryptocurrency
Nothing much should put most vendors off accepting Bitcoin and its brothers and sisters. Unless something radical happens and another digital currency breakthrough hits the news, you’re simply preparing for the future. Crypto is pushing boundaries, operating as an odd mix between an investment, a card payment, and, oddly, cash. Yes, cash.
As much as you can’t handle cryptocurrencies as you can notes and coins, crypto transactions can be anonymous. In itself, this has brought its use into question, being an ideal option to pay for less than credible services and funding shady deals and deliveries.
However, don’t be put off by that. You wouldn’t refuse cash just because it doesn’t leave a paper trail, would you? Crypto is as bonafide a payment method as your debit or credit card and cold hard cash.
Given that Bitcoin originally came about as an alternative to fiat currency, it, and all cryptocurrency, has become far more akin to an investment platform, with its value fluctuating almost daily. We’ve heard stories about those who made millions through early investment, yet, as with all investments, the gamble goes both ways. For someone to make so much, someone usually has to lose.
You need to avoid any such losses if you want to take payments without taking a hit. Thankfully, there’s a simple system to ensure that never happens. We’ll cover how further into the article.
There’s a vast lack of regulation
Given how new blockchain is and bitcoins are, there’s practically no regulation of the system as a whole. There is no bank or government organisation to back you up when things go awry, so if you’re going to start dealing in cryptocurrency, talking to your insurance provider could be a useful exercise.
For those accepting crypto payments and allowing them to sit in their wallets, there’s every chance that when they finally convert to a fiat currency, they’ll have either gained or lost value. Either way, the gain or loss is considered a taxable asset. To prove the change, you need to record the exchange rate and value at the points of acquisition and conversion.
Appealing to your ideal customer
It won’t surprise you to hear that the majority of users actively engaging with Bitcoin and cryptocurrency are typically men aged between 25 and 44-years-old (estimated at 74% in the US according to Yahoo! Finance).
If that’s what your ideal customer looks like, then it’s an attractive and easy way to appeal to them. If your typical transaction comes from the over-50s, then maybe not so much, but offering the option still creates appeal to anyone hoping to keep up with current trends—whether that’s right now or when popularity gains momentum into the mainstream.
Accepting cryptocurrency payments online and face-to-face
To hold and keep cryptocurrency, you’ll need a wallet—but this one, digital—just as you would cash. And, just like your physical cash, if you lose your wallet or access to it, you’ll lose everything that’s in it.
Paying using crypto can be done directly between two parties. Crypto wallets and apps allow simple QR code scans to carry out face-to-face payments or via an EPOS system. It’s ideal for those who don’t usually take website payments but issue invoices or payment requests via the usual email and messaging formats.
After that, you can choose from fully integrated plugins to easier-delivered payment buttons, custom payment integrations, and invoicing. In addition, some crypto payment processors provide pre-loaded payment cards for use with appropriately connected EPOS systems. How savvy is that?
Choosing the right wallet to manage your investments and payments needs a little careful investigation. For starters, you’ll require a wallet that holds and handles the cryptocurrencies you’re going to accept. A multi-cryptocurrency wallet is an ideal option—many holding over thirty crypto types and some as many as a hundred.
Current popular cryptocurrencies include:
- Ripple/XRP (used by Santander)
- Bitcoin Cash
You can exchange currencies within your wallet or convert them into fiat currency for withdrawal.
As well as covering the cryptocurrencies you plan to utilise, you should choose a wallet that offers competitive purchase and transaction fees. In addition, it needs to integrate with other wallets, be secure and hack-proof, and has the facilities you need to integrate with other crypto apps, payment systems, and processors.
Your wallet will have a unique address, and that’s all you need for direct peer-to-peer payments. Each wallet generates QR codes to make payments simpler. Your client can enter your address or scan a QR code to make their payment.
Online cryptocurrency payment systems
Depending on your website platform, you’ll have your pick of APIs and plugins to start your crypto journey.
Whether you use Squarespace, WordPress, Magenta, Shopify, WooCommerce or any other platform, they’re all supported by many of the crypto payment processors fighting for your business, and most will have their own integration options, offering standardised solutions.
Cryptocurrency payment processors
When picking out the most appropriate crypto payment processor for you, you should consider several factors. You’ll need a provider that covers everything you need, including:
- Support for each type of cryptocurrency you intend to accept
- Attractive transaction fees
- Integration with your web platform and business operations
- A regular and swift payout frequency
- No balance or payout restrictions
- Operating with multiple fiat currencies and supported in the countries where you do business
- Has security as a primary concern with secure sign-ins and verification processes
- A full support suite at all the times you need it
There are hundreds of crypto payment processors to choose from. So, if you’re serious about accepting crypto, choosing your ideal partner is likely to be the lengthiest part of the process, as implementing them into your website has been made as simple as possible for every eventuality.
Each partner provides payment in fiat or cryptocurrency. However, as we’re about to discuss, holding onto cryptocurrency could leave you short at your final conversion.
Dodging the drawbacks of volatile cryptocurrency rates
So, how can you avoid making losses on your crypto payments when they fall in value?
It’s simple. By converting your crypto payments into fiat currency on receipt, they’ll retain the precise value at the time of the transaction. Many payment processors will automate this for you into your preferred currency.
That way, you shouldn’t have to interact with cryptocurrency at all if you’d rather avoid holding it.
What will you do next?
UpperKey, a leader in the iRenting movement and FinTech disruption, is constantly moving into new fields of technology. Right now, we’re planning the best way to integrate blockchain and cryptocurrency into our platforms and systems, ensuring that our guests and clients can expect the best possible experience during every step of their customer journey.
If that includes paying by Bitcoin or any other cryptocurrency, we’ll find a way to deliver exactly what you want. It’s all part of our service, after all.
Source: Feed 1