Not so long ago, online money transfers, payments through PayPal, Credit/Debit card transactions were looked down on by the world. But the times have changed, and money exchange has been revolutionized. With the advent of cryptocurrencies, the global market was relatively quick to accept Bitcoin and its likes as a new norm.
Why should businesses accept Bitcoins?
Maintain Confidentiality and anonymity
Being a decentralized currency, Bitcoin is a more comfortable option than the fiat currencies. As the transactions are encrypted, with the user identities and personal details protected from the scrutiny of the outside world, Bitcoin has become the go-to pick for many. Unlike conventional bank transfers, wherein the user had to share the personal details, Bitcoin transfers are anonymous.
Safe and secure transactions
With the blockchain technology, they are safely recorded and authenticated, which makes it secure and efficient. The encrypted address, along with the personal private key enables one to make a successful transaction while maintaining anonymity.
Lower transaction/exchange fee
The bitcoin transactions have a lower transaction fee compared to the traditional money exchange. This again, has attracted businesses and individuals as it is profitable for them. And the charge related to it is not dependent on the amount of BTCs. A few bitcoin transfers and a 1000 Bitcoin transfer would cost the same amount in transaction/exchange fee.
No middlemen in transactions
In an international deal or a business transaction across international borders, the traditional way would be tedious as there exist multiple levels of security checks and authentications due to the involvement of different currencies and agencies. But this middlemen stage is absent in a Bitcoin transaction, and hence it is easier to transfer funds. This also means one does not need to wait for any permissions or approvals to conduct a transaction.
All that is needed is to maintain a digital wallet, safely saved private key for authentication and the address of the recipient. Using a smartphone or computer, any business – small or big- can conduct trade suing bitcoin as the online payment method.
Very convenient, can be accessed anytime
Bitcoin transactions do not rely or depend on the business hours/ bank holidays/banking hour restrictions. If one wishes to make a transaction, they can do it so without bothering about the time zone, distance, holidays, and amount limits, unlike conventional paper money. All one needs to do is access their digital wallets, enter the right information, a few clicks, and it is done. Bitcoin circuit has more details on this if you are interested.
What are the drawbacks?
Bitcoin is not legalized globally
As Bitcoin and other cryptocurrencies are not accepted legally in a few countries, the international trade in bitcoin alone is still a dream of the future. But many countries are taking steps to accept bitcoins and the likes with watchful eyes and some regulations.
Transactions could be time-consuming
Since the blockchain technology – the record-keeping method of bitcoin transaction- is a complex mechanism, the sales are a bit slower when compared to the credit card ones. No, that does not mean it will take days for a transaction to complete. The difference will be in microseconds. It only means that the transfers may not be instantaneous, but bitcoin transfers are safe and efficient than the fiat currency.
The value of Bitcoin is not stable. It changes in uncertain ways. Hence it could be risky to rely on cryptocurrencies al the way. Since its advent in 2009, the bitcoin has had its value skyrocketing to new highs and plummeting to lows that no one saw. This factor can make users apprehensive about accepting bitcoins wholeheartedly. But every investment has its risks associated with it.
It is necessary to learn how to create and maintain the digital wallets along with securely saving and remembering the private key for smooth bitcoin transactions. Understanding, studying and observing the narrative of bitcoins and other cryptocurrencies should be the new guideline for businesses around the globe.
The pros of bitcoin usage in businesses surpass the cons by miles. Looking at the pattern in which international companies and industries are accepting the cryptocurrencies like bitcoin, it will not be impossible to see many local businesses to follow them.