It has been more than a decade since Satoshi Nakamoto published the original Bitcoin whitepaper and single-handedly disrupted our financial landscape, changing the way we send and receive money. Today, Bitcoin is no longer a niche interest of a handful of early adopters but a legitimate payment method that’s accepted by some of the largest companies in the world, including Overstock, Microsoft, Namecheap, ExpressVPN, Shopify, and Newegg, just to name a few.
Even though Bitcoin and the entire cryptocurrency space may seem confusing and difficult to get into, the fact is that you don’t need to be an expert to start accepting Bitcoin payments. All you need is the right technology partner and the desire to embrace new technology to become more competitive. If you run an online business, you have many reasons why you should accept Bitcoin as a payment method, and this article explains their importance from a business standpoint.
According to data compiled by Statista, there are currently over 32 million Bitcoin wallets and at least 7.1 million active Bitcoin users. A report from Chainalysis, a leading blockchain analysis company, revealed that around a third of all Bitcoin owners actively use the cryptocurrency to pay for goods and services, instead of just holding it as an investment.
Clearly, there are plenty of people who already use Bitcoin as a more convenient payment method, and all you have to do to turn them into your customers is start accepting Bitcoin payments. Bitcoin users are known for the passion with which they support Bitcoin-friendly businesses, and it’s almost guaranteed that they’ll spread the word about your business and help you get noticed by even more Bitcoin users.
Of course, Bitcoin doesn’t make sense for all businesses out there, but it’s a boon to businesses with younger, digitally savvy customers. “If you’re an accountant in Brunswick, Melbourne, specializing with generation X and Y, you may find a lot of your clients use and trade in cryptocurrency,” says David Hunt, the founder of Adest Trading. “If you are an accountant in outback Broken Hill, it makes no sense to take cryptocurrency because most of the [general] population and your clients will not want to pay with it.”
Traditional payment processors pick and choose the businesses they want to work with, and it’s not uncommon for them to suddenly experience a change of heart and freeze the funds of clients they no longer consider desirable.
“Been a member with PayPal for over 10 years now, done hundreds of thousands of dollars’ worth of transfers with them. Recently launched a new product at a fantastic price point as a pre-order. Put it up on our website, did a big marketing campaign, sold around $65k in product,” writes one Reddit user.
“They locked the funds mid last week, saying that I needed to provide invoices and the like. I did, then they requested more invoices and business information, which I sent them. Now I got an email this morning stating that the money will be locked for 180 days. No way to appeal, nothing.”
Stories like this one are more common than most people think, and we have yet to mention the issue of fraudulent PayPal chargebacks, which has been plaguing merchants that use the payment processor since forever. No wonder then that entrepreneurs like Bradley Martini, who runs a professional RuneScape power leveling service called NMZTraining choose Bitcoin instead.
“Thanks to Bitcoin, I don’t have to worry about my funds being frozen, and I don’t have to deal with chargebacks. My customers benefit as well because Bitcoin transactions are fast, very cheap, and easy, especially compared with international bank transfers. And when I want to convert my Bitcoins to fiat currency, I simply visit Digital Surge and use their Pay feature.”
Different payment processors charge different transaction fees, but you would be hard-pressed to find one that’s cheaper than Bitcoin. Yes, Bitcoin transaction fees were extraordinarily high from the end of 2017 to early 2018, but the Bitcoin network has evolved considerably since then, and it now costs only around $0.2 to have a transaction included in the Bitcoin blockchain.
Best of all, Bitcoin transaction fees don’t increase with distance, and there are no additional currency conversion fees to worry about. Bitcoin users can choose how quickly they want their transactions to be processed, putting them in the driver’s seat of their payments.
With the Lighting Network, a payment protocol that operates on top of Bitcoin’s blockchain, on the horizon, the average transaction fee could soon be just a few cents or less. “Think of the Lightning Network like hundreds of ‘mini Bitcoin’ networks running on top of Bitcoin,” explains Blocks Decoded writer Joe Coburn. “Essentially, two or more parties agree to send money between each other, and only when they are both finished is this transaction written to the main Bitcoin network.”
People naturally gravitate toward businesses that speak their language. A recent eToro survey of 1,000 online traders found that millennials trust Bitcoin over the stock market. “We’re seeing the beginning of a generational shift in trust from traditional stock exchanges to crypto exchanges,” says Guy Hirsch, Managing Director of eToro U.S.
“Immutability is native to blockchains, and that makes real-time audits to be sensible and cost-effective and that is why Millennials and Gen X perceive crypto exchanges as less likely to be subject to manipulation and less likely to be a place where bad actors get rewarded with taxpayer money,” he adds.
Now that Generation Z, which has grown up alongside cryptocurrencies such as Bitcoin, is starting to enter the workforce, it’s very likely that all Bitcoin-friendly businesses will be perceived as progressive and forward-thinking innovators, while businesses that don’t accept Bitcoin might lose their competitive edge.
Bitcoin has become an extremely convenient payment method, offering low transaction fees, outstanding reliability, resistance to censorship or seizure, as well as many other benefits over traditional payment methods. All online businesses, especially those that are typically considered to be high-risk, can greatly benefit from accepting Bitcoin as a payment method, and we’ll explain exactly what an online business needs to do to accept Bitcoin payments in the next article. If you don’t want to wait even a minute to start accepting Bitcoin payments, you can visit our website and contact us directly.