In 2022, organizations continue to question whether or not they should accept crypto as a legit payment method from their customers. In a tech-driven age, Apple Pay and PayPal have become standard payment options. The most broadminded and progressive business owners now have started to realize and recognize the long-term benefits to make crypto one of the payment methods.
According to Deloitte, up to 2,300 organizations accept Bitcoin or another form of cryptocurrency as a payment method in the U.S. The prediction of tech experts and financial wizards came true – the adoption of crypto has had a significant increase in the last decade.
One thing is certain –the benefits of adding crypto as a payment method outweigh its limitations. Still, making it a payment method would work in favor of the customers and the businesses. Business consultants profess that more small businesses have now a positive perception of crypto since the pandemic crisis. Similarly, there is a positive perception of crypto among young consumers.
Keeping that in mind, let’s take a look at some essential perks and limitations of accepting crypto payments for businesses:
Universal Acceptance of Payments
With crypto payments, businesses can receive a multitude of payments from any user across the world. If you run an online business, accepting crypto payments would allow you to receive payments from any customer who’s interested in your product. This also means you can accept foreign payments without stressing about complex credit card chargebacks and currency conversions.
Attract More Customers
Today, business owners have to cater to the needs and preferences of younger customers. And by accepting crypto payments, you’re bound to attract a diverse range of customers and improve your reputation in the market. As more people invest, trade, and spend through crypto, small businesses have a perfect opportunity to get ahead of their competitors by accepting crypto payments.
Low Transaction Fees
One of the benefits of the crypto payment method is that it requires significantly lower transaction fees than traditional methods. In some cases, crypto does not charge any fees for processing the transaction. This, in turn, allows business owners to maintain high-profit margins. Not to mention, cryptocurrency connection and payment processing is faster than conventional payment options.
Lower Risk of Trading
Cryptocurrencies tie together with blockchain technology that offers seamless and secure trading. In fact, accepting a crypto payment means there would be little to no risk while trading. For instance, if you operate as a small business in the U.S. and accept a crypto payment, the exchange value won’t have an impact when the market suffers losses.
Reduced Risk of Fraud
The hallmark aspect of crypto payments is that it significantly decreases the risk of potential fraud along with chargeback risk. And that’s because crypto transactions and processing are completely irreversible and leave no room for hackers and fraudsters to manipulate the transactional process.
When crypto comes into play, there is little to no chance of potential fraud and cyber-attack. If your business does not have advanced cybersecurity protocols in place, you can depend on accepting crypto to cut back on the potential risk of fraud.
Crypto Payment Gateway: How Does it Work?
Technically, the mechanics of crypto payment gateway are simpler than most business owners realize. Once a customer decides to make a purchase and cover the cost in crypto, the dedicated payment processor would receive the virtual currency in an instant and convert it into USD. The conversion of the cryptocurrency would depend on its current market value. Ultimately, the fiat amount gets transferred to the business account.
What about Limitations?
Before making this decision, business owners should get familiar with the volatility of the current crypto marketplace and how it may impact them. The volatility of the crypto market mitigates the ability of businesses to convert crypto payments into US dollars after receiving the payment. The truth is that the crypto market goes through a lot of fluctuations.
On the other hand, rigid regulations make it difficult to accelerate the adoption of crypto. The use cases and applications of crypto are hard to overlook but federal governments are often reluctant to make significant changes or cave into misconceptions around cryptocurrencies.
In some cases, the complexity around crypto payment befuddles business owners and industry leaders. Although this makes all the more reason to make crypto more mainstream, it highlights the fact that the mechanics of crypto are not fully understood by businesses. But as long as businesses want to serve their customers right, they would make an effort and understand the unique dynamics of crypto.
Despite constant roadblocks, the crypto payment method serves as a great idea for small and medium-sized businesses. And contrary to misguided perception, major cryptocurrencies haven’t lost their value. Business owners can look at the crypto payment method through the lens of adapting a new tech solution that would provide added flexibility to customers. The fact of the matter is that crypto has come a long way. In retrospect, there are solid reasons for businesses to accept crypto payments.