If you or someone you know runs a business where transactions are frequently made, you might want to consider accepting Bitcoin payments from your customers. With the recent hype surrounding cryptocurrency and actually using digital assets to make everyday purchases, it makes sense to open a new medium of securing payments for your business especially if it can only increase your revenue. What better way to do so than by accepting cryptocurrency? It’s not too hard to set it up if you know what to do, so let’s go over some of the ways that you can set up Bitcoin payments for your business.
This is not financial investment advice.
This article explains ways to accept Bitcoin payments at your business.
In this article
Wallet: A crypto wallet is a software program where coins are stored. To be technically accurate, Bitcoins are not stored anywhere; there is a private key (secret number) for every Bitcoin address that is saved in the Bitcoin wallet of the person who owns the balance. Bitcoin wallets facilitate sending and receiving Bitcoins and give ownership of the Bitcoin balance to the user.
Exchanges: A Bitcoin exchange is a digital marketplace where traders can buy and sell Bitcoins using different fiat currencies or altcoins. A Bitcoin currency exchange is an online platform that acts as the middleman between buyers and sellers of the cryptocurrency.
QR Code: A QR code (short for “quick response”) is a type of barcode that contains a matrix of blocks or dots. It can be scanned using a QR scanner or a smartphone with a built-in camera. Once scanned, software on the device converts the dots within the code into numbers. For example, scanning a QR code with your phone might open a URL in your phone’s web browser. All QR codes have a square shape and include three square outlines in the bottom-left, top-left, and top-right corners.
Public Key: A public key is created in public key encryption cryptography and is used to convert a message into an unreadable format. Decryption is carried out using a different, but matching, private key. Public and private keys are paired to enable secure communication.
Hardware Terminals: A terminal is an electronic communication hardware device that handles the input and display of data. A terminal may be a PC or workstation connected to a network.
Familiarize yourself with these terms in order to get a better understanding of how to accept Bitcoin payments.
The first way that you can accept Bitcoin payments is by receiving them directly in a wallet. Depending on the volume of crypto payments that you receive, you can accept them by transferring it directly to a crypto wallet which you can set up. In fact, there are tons of crypto exchanges which you can use to help set up these wallets.
Essentially, a wallet is just a string of random letters and numbers. Numerous Bitcoin exchanges are catering to different needs that offer wallet services as well as independent wallet platforms. All you have to do is register with one of them online and use your public key as the wallet address for your customers. If you want to make it easier for them you can even set up a QR code for them to scan and send crypto to in seconds.
All they have to do is scan it, put in the amount of Bitcoins necessary and sign with their private key. Bitcoin’s value is known to fluctuate a lot, so make sure to look up the current exchange rate on any major exchange before conducting the transaction. As long as you have the time to check the prices and set up the public key, you should be on your way to receiving Bitcoin. Just remember to advertise to your customers that you accept Bitcoin, otherwise they’ll rarely speak up about the possibility of doing so.
All you have to do is register a wallet with an online exchange and use your public key as the wallet address for your customers. If you want to make it easier for them you can even set up a QR code for them to scan and send crypto to in seconds.
Recently, software developers have been creating apps that can also make accepting Bitcoin much easier. These apps work similarly to how wallets do, as they allow customers to directly transfer their Bitcoin to you through an intermediary platform. All you have to do is download one of these apps and connect your wallet to it. The merchant inputs the exact amount required in fiat and the app then generates a QR code to be scanned by the customer. All he or she has to do is scan the code and they’ll be good to go.
Since most people today use smartphones on a daily basis, it might make sense to download one of these apps since it’s not too much of a hassle. Some of the apps which you can download for this include CoinFly, BitPay, and CoinGate.
Smartphone apps are another way for you to directly receive Bitcoins from your customers. All you have to do is download one the apps and link your card or bank.
The longer that Bitcoin has been around, the more that it has been legitimized as a viable payment option. Resultantly, engineers and technicians have been developing specific hardware to help facilitate these payments. These are called Point of Sale systems and retailers can actually benefit greatly from using them.
There are various different kinds of hardware terminals for you to choose from, including Coinkite and BitPay. These are Bitcoin payment terminals which can scan QR codes, Bitcoin debit cards, and other forms of Bitcoin payment methods. The only drawback of this method is that it might cost you more money than downloading an app or using your wallet. Depending on the volume of cryptocurrency payments you receive, this may or may not be the best way for you to set it up and accept them.
However, if you own a business where you rarely or occasionally receive Bitcoin payments, it might be a waste of your money and time. Instead, stick to any of the previous forms of accepting payment unless you are completely fine with the extra cash involved with setting it up.
Online Store Payments
Run an online business and can’t use any of the previous ways of accepting Bitcoin payments? Don’t worry, you can still receive Bitcoin payments online by setting up buttons which are linked to online payment intermediaries. You can set up and advertise a “pay with Bitcoin” button that streamlines the crypto-payment process.
Some of these services include BitPay, CoinBase, and CoinGate. What happens is you are sent a few lines of HTML code which you can embed into your webpage and you’re all set! It’s actually a pretty straightforward and simple process, so even if you know that you won’t be receiving too many Bitcoin payments, it won’t hurt to get it set up. In fact, it can also show your customers that you’re extremely modern and utilize the newest technology.
Pros & Cons
At the end of the day, there are several pros and cons which are associated with accepting Bitcoin as payments for your business services. First and foremost, you won’t be put at risk for falling victim to fraud. If you receive Bitcoin, payments are final and cannot be reversed automatically. However, there are times when credit card charges are declined after some time and the payment is canceled altogether, leaving you with a bunch of extra work on your hands.
Additionally, you don’t have to pay any extra transaction fees if you choose not to. When it comes to credit card payments, additional transaction fees add up and can end up costing you a lot of money When you receive Bitcoin payments, you have the ability to choose whether or not you want to pay transaction fees which go to the computers that host the network. If you do end up paying, you’ll get your Bitcoin faster but having the option to not pay is pretty convenient.
However, the biggest reason why someone may not want to accept Bitcoin payments is because of the volatility of the market. In just a matter of days — or even hours — you could see a good amount of your Bitcoin payments depreciate in value if the market crashes, leaving you with less money. Anytime you decide to accept Bitcoin or other crypto-based payments, you must accept the risk of highly volatile markets at play which can deplete your revenue.
On the flip side, there can be circumstances where the market rebounds and something that you originally sold for $500 in Bitcoin increases to be worth more. If you quickly can transfer that money into fiat when the market is doing well, you’ll find yourself with more money than before. It all depends on the market and whether or not it works in your favor, which is a risk you must be okay with taking when it comes to accepting Bitcoin payments.
Pros and cons associated with receiving Bitcoin payments include a highly volatile market, increased transparency, and less transaction fees.
As technology continues to innovate and revolutionize the way we live of life, cryptocurrency has emerged as one of the newest additions to the ever growing list of promising concepts to look out for. In fact, it has slowly been legitimizing itself as one of the newest asset classes that should and will be making strides in improvements over the next few years or so. As such, anyone who owns a business where Bitcoin could serve as a viable form of payment for their services should highly consider implementing one of these systems to accept and transfer them into their bank. Although it’s still very early in regards to Bitcoin being normalized for everyday payments, we are starting to see a higher volume of these transactions made everyday. As always, happy investing!
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