What is Cryptocurrency and Should You Accept it as Payment?

What is Cryptocurrency and Should You Accept it as Payment?

Posted by Gwen Lewis on February 20, 2018
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Gwen Lewis
6 posts so far

For the ladies out there who run small businesses, it’s vital to stay on your game and embrace new technologies that help you remain competitive. Your business probably already has a website, and maybe it even has a mobile application. However, there’s another tech trend that stands poised to dominate the business world in 2018, and you’ll want to make sure you adopt it before others in your space do. This year, consider making your ecommerce site cryptocurrency compatible.

“Wait a minute,” you might be thinking, “slow down! What’s so great about cryptocurrencies?” For that matter, some of you may still need a clearer picture of what cryptocurrency really is. Fear not. We’re here to help. This brief overview will help you understand the core concepts behind the world’s trendiest way to pay, and help you understand how cryptocurrencies can better your business.

Understanding Cryptos: The Basics

Cryptocurrencies rely on a technology called Blockchain. The idea behind Blockchain is simple: it’s essentially a secure digital record of transactions that is near-impossible to alter illegitimately. Blockchain is able to remain secure because unlike other digital records, it isn’t stored in a single place. Instead of being rooted to a domain or bound to a server, Blockchain’s ledger exists anonymously on many devices throughout the world, which are referred to as “nodes”. These nodes are all updated whenever a new transaction takes place. Essentially, it’s like having thousands of anonymous witnesses each time you make a transaction. As a result, transactions that rely on this technology are practically immune to fraud.

So… Where Do Bitcoins Come In?

Most people associate the word “cryptocurrency” with the term “Bitcoin”, and aren’t sure how Blockchain fits into the picture at all. Fortunately, it’s all pretty easy to explain: Bitcoins are just one type (or “token”) of cryptocurrency that can use Blockchain technology to remain secure and anonymous. They have no inherent value—they’re just symbolic units that represent whatever people agree they are worth. Some people worry about this, but remember: the US dollar doesn’t have inherent value either. Both are examples of floating currencies, unlike fiat currencies that are based on tangible resources like the gold standard.

What Makes Cryptos Different?

So… if Bitcoins and dollars are both floating currencies, what makes them different? There are numerous differences, but here are the ones you’ll need to know about:

Cryptos Are Anonymous

Have you ever wanted to make a purchase that wouldn’t show up on your credit card statement? Cryptos might be the answer for you. Because Blockchain technology is totally anonymous, nobody has to know what you’re buying. This also has the potential to protect online shoppers who are sick of having their personal data farmed by social media and sold to advertisers. From a business owners perspective, there’s another advantage: you won’t be able to offer returns on anything paid for in cryptocurrencies. Say goodbye to your complaints department!

Cryptos Are Secure

Have you ever had to deal with credit card fraud? It can be stressful, whether you’re a customer or the proprietor of a business. Fortunately, Blockchain technology makes this kind of activity all but impossible. There are some concerns about the stability of individual tokens themselves, but this is generally more of an issue for smaller, more obscure tokens. Larger tokens such as Bitcoin seem much less volatile, pending some kind of major change in the laws that regulate them.

It’s easier than ever for individuals to convert money into cryptocurrency, so it’s only a matter of time before they start expecting to be able to purchase regular goods and services with various tokens. Consider adding a feature to your website that lets customers buy with Bitcoins—if you do, you may find yourself among the first in your niche to access an exciting new market!


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What is Cryptocurrency and Should You Accept it as Payment?

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