Many people are talking about a bubble in the cryptocurrency world but the truth is Bitcoin is here to stay. Many countries are starting to legalize it as a real currency and this is just the beginning of a digital currency that we have never witnessed. Yet the wildly high value and the extreme fluctuations are the two aspects that small businesses shy away from embracing the world’s top cryptocurrency.
In case you don’t know, Bitcoin is a decentralized peer to peer digital currency that was released to the public in 2009. Created by Satoshi Nakamoto to combat the greed from bankers and big corporations, it has since grown to a $300 billion market cap. Many people are jumping on the train. All transactions are verified and confirmed by miners onto the blockchain. The blockchain is a public ledger that is transparent to everyone.
While many people don’t believe in Bitcoin future, saying it is a bubble, it is still around. It also cannot be called a bubble like it won’t be around in the future. The price may drop but in the long term, it is here to stay. In fact, Bitcoin has the characteristics that small businesses should find it worth their while:
No Waiting
Banks today are very swift in transferring money from one account to another. Even then, there is time involved. This time can be a few hours to a couple of days (and this is within the same country!). Bitcoin’s underlying technology, the blockchain, does all the transaction and its verification. Bitcoin transactions are much faster than traditional ones. You could simply charge a customer, and be engaging with the next one and the currency will be credited to your wallet.
Lower Fees
Transaction fees of banks and merchant processor can be high and be a drain on your cash flow. Cryptocurrencies generally have an extremely small fee. Typical fee ranges but some cryptocurrenies like Litecoin have a transaction fee of 1 cent. That is right, one cent!
Since the transaction is confirmed on the blockchain by miners, they would prefer to complete the transaction where there is more money involved to earn (the fee). You can pay a higher fee so it attracts a miner to confirm your transaction at a higher priority and speed up your transaction process.
Digital Currency, Hard Cash
Even though Bitcoin is a digital currency, it is like cash when it comes to payments. Transactions are final. When you receive it, the customer cannot contest or raise a dispute to recover the amount. This can come handy for small businesses that cannot afford the impact of a reversed transaction. When a customer starts the transaction, cannot stop it. You will receive your hard earned money.
Invested Money
A small business would need to convert Bitcoin into fiat only when necessary, such as obtaining supplies from vendors currently not accepting Bitcoin. Bitcoins are very safe if you have a hardware wallet as you won’t have to worry about it. A good business owner will keep it safe though the fluctuation is far greater than a traditional currency, the value overall has increased many folds.
Sans Border
Small businesses have a tough time doing international business. The extreme long time for transmitting or receiving money, exchanging currency from one form to another and the transaction fee/taxes are few of the many obstacles. With Bitcoin, all of this is bypassed. Bitcoin is a decentralized currency that is accepted all over the world. You can simply transmit money from one country to another, without the need of exchanges or banks, in a matter of minutes. Small business can essentially, put itself on the international market and expand rapidly.
Advantage Over Your Competitors
Many people have made it their mission to live off Bitcoins. Meaning they have turned all their fiat money into Bitcoins and are traveling the world or going about their regular life using only Bitcoin. These people will be your ideal customers when it comes to purchasing using cryptocurrencies. There is a niche for these specific customers.
This can also help with PR. When someone realizes you accept crypto, they will definitely spread the word to others whether it’s through social media or word of mouth. The multi-billion dollar corporation was one of the first ones to accept Bitcoin and various other digital currencies.
I don't know if I would say "bitcoin is here to stay" as much as I would say "crypto is here to stay." I think just because bitcoin was the first, doesn't make it the best. The transaction fees and times are going up with network congestion. I would say that there is a bubble around crypto in general... especially bitcoin.. people are buying bitcoin because it is a buzz word, and they are entering the market without proper research. I think cryptocurrencies are eventually going to expose fiat cash for what it is and that the market will correct itself accordingly.