Bitcoin is a completely digital form of money that was invented by Satoshi Nakamoto in 2009. Bitcoin is purely peer-to-peer with no involvement of banks, government bodies, or financial institutions. As compared to other digital currencies, bitcoin process transactions cheaper and faster. It works on a technology named “blockchain” the main aim behind this technology is to keep the bitcoin wallet safe from any fraud. The digital format of bitcoin is used for a fast exchange of cash, and most businesses can benefit from it.
Bitcoin is a decentralized currency, and this is the best thing for completing the bitcoin transactions; people don’t need to involve the financial institutions to process the payments. This is the main reason why people across the world are attracted to bitcoins. Even many businesses and marketing agencies have started accepting bitcoins as a medium of exchange.
Here, in this article, we will understand the challenges that are faced by small businesses while accepting the bitcoins. Also, we will know the reasons why small businesses must accept bitcoin. If you want to invest in bitcoins then you can visit Bitcoin news trader
Challenges faced by small businesses:
Bitcoins are unstable
Unlike financial institutions where the Federal Reserve can increase or decrease the interest rates, bitcoin doesn’t have any such options. No doubt, Bitcoin is becoming stable with time, but it is still a currency whose market is unstable. Some investors find the unstable challenged to be a good thing because there is no financial institution interference, but sometimes things get difficult for small businesses.
Bitcoin is unregulated
Because bitcoin is a decentralized currency, it means it lacks the support of the government. Some of the governments consider bitcoin a legitimate commodity that can positively influence financial regulations. Some countries have banned or restricted the bitcoins, and no one in that country can make the bitcoin transaction.
Difficult to plan
With bitcoin being a digital, decentralized currency, it becomes difficult to determine the prices, plan financial statements, and figure out taxes. Small businesses need to talk to their accountant and bookkeeper before accepting the payment of bitcoins.
Reasons why small businesses must accept bitcoin:
As different types of crypto wallets are available to store bitcoins, many small business have started accepting money through bitcoins.
No transaction fee
Almost all the financial institutions charge a merchant transaction fee 2-3%, and this is the main drawback. The solution to avoid the transaction fees is to accept bitcoin. Bitcoin transactions either charge 1 percent or charge 0 to carry out the transactions even in abroad.
There are no fees attached to bitcoins, and small businesses can easily send and accept bitcoins. People don’t require paying their revenue to banks because it is a decentralized currency, and no banks are required to verify the transactions.
Not restricted to borders
For exports the products and services to and from abroad, the bitcoins provide the best deal. Bitcoin is not tied to any government or company and is a global currency. With bitcoins, you can make purchases from abroad and can pay bitcoins as a medium of exchange. Unlike banks, bitcoin transaction doesn’t take time and are not restricted to a specific country.
Great investment opportunity
No doubt, the market of bitcoin fluctuates a lot. The biggest challenge is that it is not stable, like other payments in gold, cash, or other currencies. The unstable market of bitcoin is definitely a drawback, but small businesses can see it as a great investment opportunity. Start accepting bitcoins and wait for an increase in their value before converting them into cash.
Bitcoin makes a great investment opportunity, unlike other currencies, as it is less boring. The growth from 2011 to 2013 of single bitcoin rises from $2 to $1242. Because of the unpredictable market, its value falls back to $800 in 2019, but it is counted to rule the market.
Because of bitcoin being a digital currency, it works similar to cash payment. Bitcoin transactions are irreversible and final, and the customer can’t deny the services and dispute for payment. Payment once done through bitcoin is irreversible, and no financial institution, government bodies, or Satoshi Nakamoto can reverse it. Therefore, it leads to fewer disputes for payments among people.
Small businesses must understand the business opportunities offered by bitcoin to grow. Also, understand the reasons that show bitcoins can help in growth of small businesses.
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