The conversation about crypto is not going anywhere. If you own a business, you have likely heard about it from conversations with customers regarding whether you take Bitcoin or from news stories about businesses putting crypto on the balance sheet. Between the hype and skepticism, it can be tough to decipher what makes sense for your own business.
Let’s cut through the noise and see what cryptocurrency really means for business owners in the year 202. No fluff, no jargon, just what you need to know in a practical sense.
Why Businesses Should Allow Crypto Payments
Accepting cryptocurrency allows businesses to reach a much larger group of potential customers. Some people prefer to use digital currency when making purchases and will go out of their way to find merchants that accept cryptocurrency. You are not simply adding another payment option; you are demonstrating that your business is on top of the latest technology by offering it.
The transaction fees tell an interesting story. When a merchant accepts credit card payments, he has to pay a 2-3% transaction fee, as well as a monthly fee. On the other hand, the costs associated with making cryptocurrency payments are lower than traditional payment processing fees, particularly for higher-value transactions. Therefore, if you operate on very thin profit margins, the reduced costs from using cryptocurrency could quickly have a positive impact on your bottom line.
Also, cross-border payments can be easier to process through cryptocurrencies because, instead of exchanging currencies and paying large international wire fees, a merchant receives their payment directly, without a middleman taking a portion of the payment or having to wait 72 hours for the payment to clear. This greatly benefits merchants who conduct business internationally.
Finding Your Entry Point
You don’t have to dive in headfirst. Start small and test the waters. Many businesses begin by accepting crypto for specific products or services, as this lets them learn the process without risking too much.
If you’re curious about which digital currencies make sense for your business, research the best cryptocurrencies to invest in before deciding what to accept. The major ones, like Bitcoin and Ethereum, have the widest adoption. Your customers will more likely hold these than obscure tokens. Newer options like Solana offer faster transactions but less recognition.
Payment processors make acceptance easier than you might think. Services like BitPay or Coinbase Commerce handle the technical side. You get a simple checkout button, and they manage the crypto-to-cash conversion if you want it. Setup takes hours, not weeks.
What This Means for Your Balance Sheet
As an example, when you hold cryptocurrency as an asset in your company, it is treated very differently from cash on hand. This could result in either large gains or losses, depending on the direction of the cryptocurrency’s price. Companies such as Strategy (formerly MicroStrategy) have included crypto as a major component of their treasury strategies, with over 582,000 BTC in their portfolio. However, other companies may have attempted it and then removed it from their balance sheet due to volatile markets, leading to unstable, unpredictable quarterly reports.
Cryptocurrency is reported on your company’s financial statements based on how the accounting standards interpret reporting. The majority of jurisdictions currently consider cryptocurrency as property rather than currency. As such, every time a purchase or sale occurs involving your company’s cryptocurrency (i.e., each “transaction”), it will trigger a taxable event. Therefore, your accountant should have some level of understanding of cryptocurrency, or you will need to locate an accountant who understands cryptocurrency.
The Big picture
The growth of cryptocurrency adoption within markets continues. Many major payment processing companies, such as Visa and Mastercard, have integrated cryptocurrency into their services, and PayPal is also allowing users to purchase and use cryptocurrency. The current development of cryptocurrencies demonstrates that they are gaining traction among everyday people and are therefore likely to grow and become more widely accepted rather than shrink in popularity.
As stated above, consider whether your competitors may be planning to offer this service to consumers. Accepting cryptocurrency can help you gain media attention and create a sense of novelty among potential clients, thereby increasing your overall brand awareness and client acquisition. Beyond providing an additional payment method, accepting cryptocurrency also offers a unique marketing opportunity.
The Bottom Line
Crypto may not be right for your company. If you are operating with small profit margins and can not afford to take on risk (volatility), you should hold off. If none of your customers ever ask about it and you do not sell anything internationally, the benefits may not be worth the time spent learning about it.
However, if you are interested in the potential of crypto and willing to spend some time learning how it works for your business, there is nothing wrong with taking the first step. Begin small, use established processors, and view crypto as an additional payment method. There is no need to become a “crypto fan” or “convert,” but simply a business owner who wants to give his/her customers another way to make purchases.
