• Perhaps one of the most significant developments over the last decade is the introduction of cryptocurrency.
• Bitcoin, the first digital asset to beget an entire ecosystem of cryptocurrencies, has been the talk of the town recently.
Image: REUTERS
The financial world is evolving at a sharp pace, presenting its participants with a plethora of new opportunities.
Perhaps one of the most significant developments over the last decade is the introduction of cryptocurrency.
While the idea of cryptocurrencies was met with much criticism and skepticism, investors and business tycoons alike seem to have changed their tune with many jumping aboard the crypto bandwagon.
It has helped transform the way in which many businesses interact with one another as well as their clients.
Bitcoin, the first digital asset to beget an entire ecosystem of cryptocurrencies, has been the talk of the town recently. Most of it has been due to mainstream acceptance and the following price surges.
Merchants, big or small, all over the world have been jumping onto the new hot bitcoin payments trend, especially during the pandemic season.
If you’re still sketched out about incorporating Bitcoin into your business activities, it may be wise to reconsider. Below are the top four reasons why merchants should start accepting cryptocurrencies, especially Bitcoin:
Lower Transaction Costs
Bitcoin makes use of Blockchain technology. This allows it to remain decentralized instead of relying on a central authority or intermediary such as banks or the government to process your financial transactions.
This directly means that per-transaction fees for accepting bitcoin are generally lower than those charged for debit and credit purchases. This is perhaps one of the most important reasons for merchants to latch onto Bitcoin. As for smaller businesses, even a 5 per cent of transaction fee can be a drain on the cash flow.
Also, businesses can easily send or accept bitcoins as payments due to the increase in acceptance of bitcoin by many major financial firms such as PayPal, Square, and many more.
No Chargebacks
Bitcoin purchases cannot be reversed once completed, so there are no chargebacks and no returns. This, in turn, will help many merchants save money.
Credit card chargebacks tend to occur when a user disputes a purchase made with their card. This is often due to the sale of defective goods or the items are never received. Or, many even perhaps they fell victim to identity theft or never actually authorized the purchase made on their account.
When a chargeback takes place, not only does the credit card company withdraw the money in question from your merchant account and deposit it into the customer's account, but you are usually liable to pay a costly chargeback fee.
However, if you allow for bitcoin purchases, it could be an entirely different story. As people who purchase from you in Bitcoin will generally have no recourse in a dispute and this will eventually save you from not only the return money but the chargeback fees as well.
Quick Payments By Customers
For smaller businesses, having sufficient cash on hand is vital for the healthy running and survival of the business.
Choosing to accept payments in bitcoin may put cash much faster within the reach of the business as compared to credit card payments.
With credit cards, generally, funds may actually be locked up for a week or even more and may even be held in a sort of escrow in the event of a chargeback. However, Bitcoin overcomes this issue.
With bitcoin, payouts arrive in the merchant's bank within two or three days, if not hours. This allows businesses to receive payments faster so they can maintain their working capital.
Investment Opportunity
Much like traditional fiat currencies, Bitcoin fluctuates in value as well. However, the cryptocurrency operates in a much more volatile market.
Even though this constant flux may seem like a huge drawback to dealing with cryptocurrency, it is seen by many as an opportunity for profit-making. The dynamic nature of the market that Bitcoin operates in makes it a great investment opportunity.
Many companies have realized this and have decided to dabble into bitcoin. Tesla, for example, added $1.5 billion worth of bitcoin to its balance sheet and has made huge profits from the recent surge in Bitcoin's price.
For novice investors and traders, things are easier now more than ever, with the availability of trading platforms. These use AI-powered algorithms to allow users to generate passive incomes without even having to be an expert or allocate the significant time of the day to it.
For further information, you can visit https://bitqt.org/ on how to get started with such a platform.