Cryptocurrency is a software-based digital currency designed to function as a form of payment when buying goods and services. In essence, you may think of cryptocurrencies as casino chips wherein you have to exchange real currency for some crypto before you can use them to purchase online.
What are the advantages of using cryptocurrencies as a medium of exchange compared to simply paying through the usual online payment methods, you ask? As part of its appeal, cryptocurrency utilizes an online ledger protected by strong cryptographic and encryption algorithms to make way for a more secure online payment transaction.
Cryptocurrency relies on blockchain, a technology spread across a myriad of computers—not just allowing increased security but also trade flexibility. Through cryptocurrency, anyone can instantly wire payments while making the transaction private and completely secure.
How can small businesses benefit from using cryptocurrency?
With the lack of a central organization in control and no government oversight like in fiat currencies, crypto essentially operates in a free-flowing market with little to no interference and limitations. For this, cryptocurrency can ultimately benefit small businesses—but why them in particular?
Small businesses are known to be nimble, making them agile enough to easily adopt new technology like cryptocurrency and leverage them to get a leg up over their competition. Here’s a list of the top advantages cryptocurrency can bring to the table:
Safe, worldwide accessibility
With its decentralized technology, cryptocurrencies like Bitcoin can be challenging to fake and provide global peer-to-peer transactions. If you’re wondering what is Bitcoin exactly, it’s a digital currency unit—one among many others available in the market today.
Apart from the security they offer, cryptocurrencies like Bitcoin enable borderless payment transfers and transactions, thanks to the lack of cross-border barriers. With worldwide accessibility, it allows small businesses to compete even against their bigger competitors.
Faster transactions with more affordable fees
Traditional payment processing can take days, even weeks to complete, but without a central organization or government acting as a regulatory authority controlling the crypto market, payment transactions can be completed almost instantaneously and with no hidden processing fees, no matter the amount.
Unlike with fiat currencies, there also won’t be an issue dealing with exchange rates. On top of that, cryptocurrencies are recognized and accepted globally, making them beneficial to businesses.
Provide an alternate payment option
With more and more brands embracing digital technology and moving their business online due to the ongoing COVID-19 pandemic, competition is growing stiffer than ever before. Gain a competitive edge and keep your rivals at bay by having an additional payment method and start accepting cryptocurrency as payment. This way, you can attract new loyal customers who put a premium on digital safety.
Boost brand awareness and visibility
Rising above the noise and standing out in today’s overcrowded market may sound like an impossible feat, especially for small businesses—unless you find a way to innovate to get people talking about you and ultimately differentiate your company from your competitors.
One way to do just that is to adopt cryptocurrency as a payment option for your customers. According to a study conducted in the United States, 39% of customers prefer to have Bitcoin as a payment option for their online purchases. As an early adopter of cryptocurrency transactions, your small business can almost instantly attract attention and gain exposure, boosting brand awareness and visibility.
Apart from that, by adding a crypto-based payment system, you’ll also inevitably open doors to a loyal network of passionate cryptocurrency communities who will advocate for your brand.
Protect customer confidentiality and privacy
Each year, news about big, multinational organizations being hacked spread worldwide. These types of security breaches often involve thousands, if not millions, of customer data and transaction records. Such events result in customers being vulnerable to threats and identity theft, among other safety issues.
With cryptocurrency relying on encryption and blockchain technology, small businesses like yours can provide your clients greater safety and anonymity. It will enable you to elevate security and make your company appealing to customers who need to keep their privacy or are concerned about their transactions’ safety.
As the digital currency continues to gain traction in recent years, it may well be the future of money—in turn, early adopters may indeed have a unique advantage.
Cryptocurrency not only allows small businesses to reduce unnecessary transaction fees and boost their worldwide reach and accessibility but also amp up customer confidence by providing an added layer of safety, fraud protection, and anonymity.
In a world where online sites and platforms constantly track customers’ every move to collect and analyze data, privacy through crypto can be a unique feature for your small business to rise above the digital noise in today’s oversaturated eCommerce industry.