This article is for partners to gain a basic understanding of Cryptocurrency and why everyone should start accepting it.
What is Cryptocurrency?
Cryptocurrency is a digital asset designed to work as a medium of exchange. Coin ownership records are stored in a digital ledger using strong cryptography to secure transaction records, to control the creation of additional coins, and verify the transfer of coin ownership.
While cryptocurrency can seem a bit daunting, in reality, it’s just a type of digital cash. You can use it to securely purchase items online without needing a card or even a bank account. Popular cryptocurrencies include Bitcoin, Ethereum, and Litecoin.
Many of today’s businesses accept cryptocurrency as a form of payment, making it easier than ever to spend it like cash.
Why should you start accepting cryptocurrency?
In most cases, it's a good idea to go ahead and accept cryptocurrency. Consumers are using it more and more. The benefits of accepting cryptocurrency help your clients and your business. Here are six reasons why your business should start accepting Cryptocurrency
Low Transaction Fees
Accepting crypto payments mean lower fees when compared to traditional payment systems. in 2017, Merchants paid over $90B to Visa and Mastercard in Credit card fees alone. This means for every $100 you spend, $4 goes towards credit card companies. There are debit card fees, credit card fees, ATM fees, transfer fees, overdraft fees, and whatnot.
Sensitive Data is Protected
Banks obtain too much data from us and retain it. They have your name, address, phone number, financial information, credit score, and more. They also know where you're spending your money. So, with fiat currencies, it is impossible to preserve your privacy.
However, virtual currencies assure a higher level of privacy. With crypto payments, the transaction data is limited to certain numbers. When a transaction takes place, the most you can know is a transaction id and the wallet address. The cryptocurrency payment processor will require your name and shipping address. No other information is shared with anyone. Thus, sensitive information is protected with crypto payments.
Cryptocurrencies such as Bitcoin are based on blockchain which is a distributed, decentralized, digital ledger. The transactions made are permanent. They cannot be modified or deleted. So, the chances of fraud are reduced to a great extent. There will be no counterfeit attempts or identity theft. Besides, blockchain has never been hacked because, in order to change one block, the hacker will need to change all the other blocks on the blockchain since they’re connected. It is enough proof that blockchain is secure. Moreover, you have complete control over your funds.
Instant Borderless Transactions
Cryptocurrencies are a great way to send and receive money across the world instantly. You don’t have to wait for transactions to be processed, no international fees, and everyone with internet access can send funds to anyone they want. Unlike banks, the transactions are completed within minutes.
Enterprises have to bear a lot of loss due to chargebacks. Business owners complain that they lose a lot of money to chargebacks. A chargeback is basically a one-way scam where customers use the products and services for free by reporting fraudulent charges against the business to their credit card company. While it is not impossible to fight those charges, but it takes a lot of time and effort for the businesses that they finally decide to take up the loss.
Well, crypto payments can help here too. The transactions that take place cannot be altered. They are recorded on an immutable public ledger. Therefore, businesses can eliminate potential fraudulent chargebacks by accepting crypto payments.
No Third Parties
Traditional payment methods involve a third party. You provide services to your customers and receive payments in your bank account for your services. But still, it is the bank that has control over your money. They can freeze your funds for whatever reasons. Also, your account can be closed if deemed necessary. This can result in huge monetary losses for businesses. But with crypto payments, that will not be a problem.
Since there is no third party involved, the money goes to your crypto wallet that you have full access to. No one else controls your wallet. So, the money stays with you no matter what. Also, the government has no control over the transactions nor they can keep an eye on the transactions.
If you’re a business owner who wants to stay ahead of the competitors, it's important that you keep up with the latest trends. You have all the great reasons to start accepting crypto payments.