With cryptocurrencies like bitcoin making headlines recently due to a rapid increase in dollar value, it’s important for small businesses to realize there’s more to this phenomenon than accepting it as a form of payment. While that’s certainly an important aspect of cryptocurrency for companies to consider, it only represents the tip of the iceberg. The truth is small businesses have a variety of options when it comes to utilizing cryptocurrency, as the following reveals.
As a business
Profiting directly from the mining or purchase of cryptocurrency sounds like outdated advice, but only if it’s bitcoin. In fact, while the ship has all but sailed when it comes to lucrative success with the flagship cryptocurrency, competing options have plenty of room for small-time entrepreneurs to get established.
Whether it’s litecoin mining or the buying of litecoin, the time is now for the little guy to seize on the most successful cryptocurrencies besides bitcoin. The safe bet is any cryptocurrency which was launched prior to 2012. Anything newer is likely too derivative to safely count on for investment potential.
As an anti-fraud measure
One of the central pillars of any cryptocurrency is the tracking mechanism of the blockchain. It’s a ledger recording the movement of a particular cryptocoin going back to its inception. In short, companies using cryptocurrency can cut down on the risks associated with traditional banking methods, such as counterfeiting, identity theft, and varying security protocols. Cryptocurrency essentially streamlines the process.
As a tool for fundraising
Due to the trackability mentioned in the previous section, cryptocurrencies like bitcoin and litecoin are taking on significance in the world of fundraising. Project backers want to know their funds are going where they were promised.
This also holds true for angel investing and other situations where entities are taking substantial risks. The better a startup can offer assurances, the more likely the gatekeepers of capital will give the greenlight.
As an increase in revenue
The idea of accepting cryptocurrency as a form of payment is often viewed through the lens of accommodating demand, similar to how businesses came to accept checks and debit cards However unlike these previous evolutions in forms of payment, cryptocurrencies are often used in transactions where one or both parties would not have otherwise committed to the sale.
While in no way a form of credit, cryptocurrency can be compared to credit cards in that their natures encourage spending. However, unlike credit cards, where the motivation is often the “buy now pay later” mindset, cryptocurrency motivates spending by its secure nature. Therefore, it’s not a stretch for companies accepting cryptocurrencies to see an immediate jump in revenue.
As a form of payment
Small businesses focus most of their attention on whether or not to accept bitcoin, litecoin, and other cryptocurrencies as forms of payment. However, these same companies need to also consider its uses as a means for themselves to make payments. Whether paying employees, contractors, suppliers, or service providers, businesses appreciate the fluidity in which cryptocurrency can move in the modern global market. Specialists overseas can be paid faster – and oftentimes at a much better rate – in what amounts to expedited outsourcing.
The growing value of cryptocurrency is getting all the press these days, but businesses need to look past the trends and consider the long-term strengths of bitcoin, litecoin, and other established forms cryptocurrencies. In short, they provide an expansion of opportunities for startups to thrive with relatively minimal risk.