What Businesses Need to Know About Using and Accepting Cryptocurrency for Payments
More and more big-name companies are beginning to adopt accommodations to allow cryptocurrency holders to make purchases with them.
Places like Amazon, Microsoft, Visa, and PayPal all now accept cryptocurrency but rely on services like BitPay to process it. So now other companies are encouraged to embrace that change themselves but may want to do so in a way that does not rely on a third party.
The Wall Street Journal had a recent article on the subject, explaining how companies can integrate cryptocurrency into their business. They certainly can go the route of the aforementioned companies, relying on a third party to facilitate things.
Or the company can take on the task itself, which will require them to have knowledge about blockchains and having their own private keys.
Companies will also need to learn how to utilize digital wallets for cryptocurrency. This is similar to the concept of bank accounts, where wallets can be used primarily for either storing crypto, or a wallet that is meant for regular use.
And then in the case of the latter, there need to be measures in place to keep records of amounts and track changes, especially considering the value of crypto still fluctuates quite drastically in some cases.
Accurate record-keeping is also imperative to thwart potential cybercriminals who may attempt to use cryptocurrency as part of a money-laundering scheme. Any crypto the company winds up accepting needs to have a clear source behind it.
New systems are advancing to expedite the process of using crypto, such as second-layer protocols. However, this can also make it easier for those with nefarious intentions to create problems before they are caught.
Fred Hubler, Chief Wealth Strategist for Creative Capital Wealth Management Group believes that until the underlying cryptocurrencies stabilize in price, it will be hard for merchants to accept a significant part of payment that way.
“We are probably 2-20 years away from the major cryptocurrencies stabilizing to the point that it is as volatile as other currencies and assets on a daily basis.” Some are betting on it becoming stabilized sooner rather than later, continued Hubler. “We keep our client’s exposure limited due to its volatility but for some clients, it’s fun to watch.”
This is obviously a lot of new information for a company to digest and it is likely part of the reason some businesses have been more gradual in adopting crypto usage. Companies considering making this jump want to provide more options for their customers, but that can’t happen at the risk of security vulnerabilities.
To learn more about what you should keep in mind for payments involving cryptocurrency, read the Wall Street Journal’s perspective here.
Break through the myths and confusion of Bitcoin and gain a deeper understanding of cryptocurrencies in a lunchtime NoonZOOM webinar entitled “Dispelling Bitcoin and Cryptocurrency Myths” happening Thursday, October 21, at noon.
Fred Hubler, the Chief Wealth Strategist of Phoenixville-based Creative Capital Wealth Management Group, will sort through seven myths about Bitcoin, including:
- Bitcoin is a bubble and buying it is a big gamble.
- Bitcoin isn’t secure and has no real uses or value.
- Bitcoin will soon be replaced by another cryptocurrency.
- Bitcoin is bad for the environment.
An interactive Q&A will follow Hubler’s presentation.